FOURTH QUARTER 2017 FINANCIAL REPORT ALFA ...ALFA´S FOURTH QUARTER 2017 2 SUMMARY OF GROUPS´ PERFORMANCE DURING 4Q17 Sigma’s revenues amounted to US $1,593 million, up 11% from

ALFA, S.A.B. DE C.V.

FOURTH QUARTER 2017 FINANCIAL REPORT ALFA REPORTS 4Q17 EBITDA OF US $568 MILLION

Monterrey,N.L.,Mexico,February12,2018.-ALFA,S.A.B.de C.V. (ALFA), a leading Mexican industrial company,reported today its4Q17unaudited financial results. TotalrevenueswereUS$4,297million,up11%year-on-yearduetohighersalesachievedatallbusinessunits.EBITDAwasUS$568million,up5%vis-à-vis4Q16.

Commenting on the Company’s results Mr. AlvaroFernandez, ALFA’s President, said: “Our businessesperformedbetterduring4Q17.AtAlpek,highermarginsinbothbusinesssegmentsdroveresults,Sigmasawgrowthinall regions where it operates, while Axtel improved itsEnterpriseandGovernmentsegmentandbenefittedfromtowersales.Nemak,however,continuedtobeaffectedby

lower activity in the US auto industry, negative price lagandhigherlaunchexpenses”.

Consolidated capital expenditures and acquisitionsamountedtoUS$250millionduring4Q17.NetDebtatthequarter end of US $6,300 million was 8% higher whencomparedtotheUS$5,844millionin4Q16.Attheendofthequarter,financialratioswere:NetDebttoEBITDA:3.1times;InterestCoverage:4.6times.

Majority Net Loss was US $31 million in 4Q17, animprovementfromtheMajorityNetLossofUS$59millionin 4Q16. This improvement ismainly explainedbyhigheroperatingincomethatoffsethigherexchangelosses.

SELECTEDFINANCIALINFORMATION(US$MILLION)

4Q17 3Q17 4Q16

CH.%VS.3Q17

CH.%VS.4Q16

YTD.‘17

YTD.‘16

YTDChg.%

CONSOLIDATEDREVENUES 4,297 4,278 3,874 - 11 16,804 15,756 7Sigma 1,593 1,608 1,438 (1) 11 6,054 5,698 6Alpek 1,321 1,312 1,183 1 12 5,231 4,838 8Nemak 1,094 1,099 996 - 10 4,481 4,257 5Axtel 226 211 191 7 19 822 736 12Newpek 31 21 27 51 14 107 107 1

CONSOLIDATEDEBITDA1 568 400 540 42 5 2,018 2,322 (13)Sigma 195 179 166 9 18 676 663 2Alpek 141 3 133 - 6 384 669 (43)Nemak 166 153 186 8 (11) 715 798 (10)Axtel 77 74 46 4 66 290 225 29Newpek 3 1 12 303 (71) 3 9 (70)

MAJORITYNETINCOME (31) (333) (59) 91 48 (134) 142 (194)CAPITALEXPENDITURES&ACQ. 250 326 450 (23) (44) 1,101 1,491 (26)NETDEBT 6,300 6,545 5,844 (4) (8) 6,300 5,844 (8)NetDebt/LTMEBITDA* 3.1 3.3 2.5 LTMInterestCoverage* 4.6 5.1 6.6

*Times.UDM=Last12months1EBITDA=OperatingIncome+depreciationandamortization+impairmentofassets.

CONTENTS:SummaryofGroups…2–AlfaFinancialTables…6–ALFAGroupsFinancialInformation…10

Thisreleasemaycontainforward-lookinginformationbasedonnumerousvariablesandassumptionsthatareinherentlyuncertain.Theyinvolvejudgmentswithrespectto,amongotherthings, futureeconomic,competitiveandfinancialmarketconditionsandfuturebusinessdecisions,allofwhicharedifficultor impossibletopredictaccurately.Accordingly,resultscouldvaryfromthosesetforthinthisrelease.Thereportpresentsunauditedfinancialinformation.FiguresarepresentedinMexicanpesosorUSDollars,asindicated.Whereapplicable,pesoamountsweretranslatedintoUSDollarsusingtheaverageexchangerateofthemonthsduringwhichtheoperationswererecorded.FinancialratiosarecalculatedinUSDollars.Duetotheroundingupoffigures,smalldifferencesmayoccurwhencalculatingpercentchangesfromoneperiodtotheother.

ALFA´S FOURTH QUARTER 2017 2

SUMMARY OF GROUPS´ PERFORMANCE DURING 4Q17

Sigma’srevenuesamountedtoUS$1,593million,up11%from4Q16.AllofSigma’sregions improvedyear-on-year,Mexicoincreased10%andUSsalesincreased4%,bothmainlydrivenbyhigheraveragepricestooffsethigherrawmaterialprice increases frompreviousquarters. European salesbenefited from the consolidationof theSeptember2017Caroliacquisition,increasing14%.LatinAmericasalesincreased16%,reflectingtheacquisitionofSupemsacompletedattheendof2Q17.

Sigma reported 4Q17 EBITDA of US $195 million, up 18% year-on-year, mainly explained by the performance of theMexicanandUSoperations,theconsolidationofSupemsaandCaroli,anextraordinarygainrelatedtotheacquisitionofCaroliandamorefavorablecurrencyenvironmentinEuropeandMexico.

During4Q17,capitalexpendituresandacquisitionstotaledUS$71millionwithfundsbeingutilizedforthenewplant inBurgos,Spainandotherminorprojectsacrossthecompany.TheinvestmentintheLaBurebaplantiscompleteandduring4Q17hadcommencedproductionfortheSpanishandotherEuropeanmarkets.

Attheendof4Q17,NetDebtwasUS$1,936million,12%higherthanin4Q16mainlyexplainedbytheoutflowsrelatedtothe Bureba facility and the acquisitions of Supemsa and Caroli. Financial ratios at the end of 4Q17were:NetDebt toEBITDA,2.9times;InterestCoverage,4.7times.

(Seeappendix“A”formorecomprehensiveanalysisofSigma´s4Q17financialresults)

Alpek’s revenues for the fourth quarter totaled US $1.3 billion, up 12% year-on-year mainly due to higheraverageprices inbothbusiness segments.Average4Q17prices increased11%when comparedwith4Q16,while4Q17volumewasup1%year-on-year.

4Q17EBITDAwasUS$141million, includingaUS$16millionnon-cashinventorygain.Adjustingforthe inventorygain,ComparableEBITDAwasUS$124millionandUS$117millionin4Q17and4Q16,respectively.PETmarginrecoveryandarisingfeedstockpriceenvironmentcontributedtoComparableEBITDAgrowth.AccumulatedEBITDAasofDecember31,2017wasUS$384million,includingtheUS$113millionM&GA/Rprovision,aUS$22millionnon-cashinventorygainandaUS$12millionone-timegain fromtheSelenisCanada Inc.acquisition (2016).ComparableConsolidated2017EBITDAtotaledUS$462million,down27%versus2016mainlyduetotheanticipatedmargincontractioninPPandPET,aswellastheM&GPTAsupplydisruption.

InNovember2017,M&GMexicoresumedPETproductionunderatemporarytollingagreementwithAlpek,whosuppliestherequiredfeedstocks(e.g.PTAandMEG)andpaysatollingfeeinexchangeforPETfromtheAltamirafacility.ThetollingagreementwasrecentlycomplementedbyacreditagreementthroughwhichAlpekwillprovideuptoUS$60millioninsecured financing to M&G Mexico subject to certain conditions. The combination of tolling and credit agreement isintendedtosupportM&GMexico’sPEToperationswhileapermanentrestructuringplanispresentedtoAlpekandothercreditors. Alpek’s priorities inM&GMexico’s restructuring process are: i)maximizing the recovery of its claims and ii)maintainingitsPTAsupplytotherestructuredentity.

The restructuringprocess associatedwith the integratedPTA-PETplant thatwasbeing constructedbyM&G inCorpusChristi,TXalsoadvancedduring4Q17.M&GUSACorporation(M&GUSA)filedforbankruptcyinDelawareandreceivedapprovaltobeginthesaleofcertainassets,includingtheCorpusChristiplant.Biddingproceduresarescheduledtooccurin1Q18.Alpek’spriorityinM&GUSA’srestructuringprocessistoreaffirmitsCorpusChristicapacityrightsundertheoriginalagreementsorasabidderfortheCorpusChristiassets.


During4Q17,AlpekacceptedContourGlobal’sofferandmovedforwardwiththesaleprocessofitscogenerationpowerplantsinCosoleacaqueandAltamira,Mexico.InBrazil,theCADECourtapprovedtheacquisitionofPetroquimicaSuapeandCitepefromPetrobras.Aspartoftheapprovalprocess,Alpekproposedenteringintoamergercontrolagreement(AcordodeControledeConcentração–ACC),committingtomaintainanenvironmentofeffectivecompetition.

4Q17CapexwasUS$30million,comparedtoUS$75million in4Q16,as investmentspendingrampsdownduetothecompletionofAlpek’sstrategicprojectprogram.Mostofthesefundswereinvestedinthe350MWpowercogenerationplantinAltamira,Mexico,whichadvancedasplannedand80%ofthetotalinvestmenthadbeendisbursedbythecloseof2017.

NetDebtasoftheendofthequarterwasUS$1,262million,up21%year-on-year,drivenbytheinvestmentinstrategicprojects,andtheacquisitionofaUS$100millioncreditrelatedtoM&G.Atquarterend,financialratioswereasfollows:NetDebttoEBITDA,3.3times; InterestCoverage,4.8times.AdjustingfortheUS$113millionM&GA/Rprovision,NetDebttoEBITDAwas2.5timesandInterestCoveragewas6.2times.

(Seeappendix“B”forAlpek´s4Q17financialreport)

Nemak´s4Q17salesvolumewas12millionequivalentunits,2%higherthan4Q16,mainlyduetohighercustomerdemand in Europe for Nemak components, where volume increased 6% y-o-y reflecting the strength of the market.Meanwhile, North America volumes remained steady as new program launches compensated for lower customerproduction.Likewise,inRestoftheWorld,industryrecoveryinSouthAmericacompensatedforlowercustomerdemandinAsiaforNemakcomponents.

RevenueswereUS$1,094million,up10%year-over-year,supportedbyhighervolumesandhigheraluminumprices. Inturn,4Q17EBITDAtotaledUS$166million,down11%year-on-year,mainlyasa resultofnegativemetalprice lagandincreasedexpensesrelatedtonewprogramlaunches.EBITDAperunitwasUS$13.8in4Q17,downfromUS$15.8inthesameperiodlastyear.

CapitalexpendituresinthequarteramountedtoUS$109millionasthecompanycontinuedwithinvestmentstoincreaseandadaptproductioncapacitytomeetnewdemandrelatedtorecentlywoncontracts.Likewise,resourceswereinvestedinthecontinuedramp-upofnewprogramstoproducestructuralandelectricvehiclecomponentsinNAandEU.

NetDebtattheendof4Q17totaledUS$1,271million,up1%from4Q16,reflectingthecapitalexpendituresduringtheperiod.Financialratiosin4Q17were:NetDebttoEBITDAof1.8times,andInterestCoverageof11.2times.

(Seeappendix“C”forNemak´s4Q17financialreport)

Axtel’s revenues in the fourth quarter totaled US $226 million, up 19% year-on-year, mainly explained by theperformancefromthecoreEnterpriseandGovernmentsegment,whileintheMassMarketsegmentFTTxrevenueswerenotenoughtooffsetthedeclineofitslegacyWimaxbusiness.Inpesoterms,totalrevenuesincreased13%inthequarter.EnterpriseandGovernmentsegmentrepresented83%ofrevenuesinthequarter.

4Q17EBITDAwasUS$77million,up66%year-on-year,explainedinpartbyaUS$18millionbenefitfromthethirdtrancheofthetransmissiontowersale.Excludingthiseffect,EBITDAincreased26%from4Q16,mainlyduetoabetterperformancefromtheEnterpriseandGovernmentsegment.

Capital expenditures totaled US $23 million in 4Q17 (US $41 million excluding tower sales), including investments toprovidelast-mileaccesstoconnectcustomers,todeployITinfrastructureandtofurtherincreasedatacentercapacityinQueretaro,Mexico.Attheendof4Q17,NetDebtwasUS$973million,similaryear-on-year.Financialratiosattheendof4Q17were:NetDebttoEBITDAof3.4timesandInterestCoverageof3.4times.


(Seeappendix“D”forAxtel´s4Q17financialreport)

Newpek’s revenueswereUS$31million,up14%from4Q16,helpedbyhigherproductionandhigheraverageoilprices.

NewpekconnectedtosalesninenewwellsattheEagleFordShale(“EFS”)inSouthTexas.ThisbroughtwellsinproductionatEFSto648bythequarter’send,comparedtothe628wells inproductionat theendof4Q16.Production intheUSaveraged6.2thousandbarrelsofoilequivalentperday(MBOED)during4Q17,up4%from4Q16.StrategicdrillingandcompletionactivitiescontinuedatEFSduringthequarter.Atotalof20newproducingwellswereconnectedtosalesduringtheyear.Additionally,fivenewwellsweredrilledandcompletedintheWilcoxformationinSouthTexas,whereNewpekhasa20%workinginterest.InMexico,productionaveraged3.4MBOEDduring4Q17,down3%from4Q16.

4Q17 EBITDA was US $3 million, down 71% year-on-year, as 4Q16 benefitted by extraordinary income. CapitalexpendituresamountedtoUS$13million,whilenetdebtwasUS$34millionattheendofthequarter.

(Seeappendix“E”formorecomprehensiveanalysisofNewpek´s4Q17financialresults)

CONSOLIDATED FINANCIAL RESULTS

4Q17consolidatedrevenueswereUS$4,297million,up11%fromUS$3,874millionreportedin4Q16.TheincreaseistheresultofhighersalesacrossallbusinessunitsandmainlyreflectshighervolumesandpricesinSigma,AlpekandNemak.Duringthequarter,foreignsalesrepresented66%ofthetotal,slightlyhigherthan4Q16.Forfullyear2017,revenueswereUS$16,804,up7%from2016mainlyexplainedbyhighervolumeandpricesinSigmaandAlpek,andbyhigheraluminumpriceswhichcompensatedlowervolumesinNemak.

4Q17ConsolidatedOperatingIncometotaledUS$288million,up50%fromUS$192millionin4Q16.Factorscontributingtothisresultwere:higherpolyesterandpolypropylenemarginsinAlpek,andaUS$16millioninventorygainasaresultofhigheroilandfeedstockprices;inSigma,betterperformanceinallregionsandthecontributionfromtheacquisitionsofSupemsaandCaroliduringtheyear;inAxtel,growthintheEnterpriseandGovernmentsegment,aswellasextraordinaryincomeofUS$18millionstemmingfromthesaleoftransmissiontowers.Inturn,Nemak’sOperatingIncomewasimpactedbynegativemetalprice lagandhigher launchexpenses.ReportedaccumulatedOperating IncomewasUS$557million,down 58% from2016,mainly attributable to the impairments recorded in Alpek during 3Q17, related to the financialdifficultiesatMossi&Ghisolfi(M&G),itsmainclient.Excludingthesecosts,operatingincomewasUS$1,105million,down16%from2016.

4Q17EBITDAwasUS$568million,up5%year-on-year,reflectingthehigherOperatingIncomeexplainedabove.Year-to-dateEBITDAwasUS$2,018million,down13% from2016,explainedmainlyby the impairmentofaccounts receivablerecordedatAlpekin3Q17,relatedtothefinancialdifficultiesatM&G.

ALFAreported4Q17ComprehensiveFinancingExpense(CFE)ofUS$329million,comparedtoUS$183millionin4Q16,mainlyexplainedbyhigherforeignexchangelossesduringthequarter,ascomparedto4Q16.

MajorityNetLosswasUS$31millionin4Q17,comparedtoMajorityNetLossofUS$59millionin4Q16.Thisyear-on-yearimprovementismainlyexplainedbyhigherOperatingIncomethatoffsettheincreaseinComprehensiveFinancingExpense(“CFE”)alreadyexplained.Year-to-dateMajorityNetLosswasUS$134million,down194%fromthesameperiodin2016,reflectingmainly theeffectsofprovisionsandasset impairmentsatAlpekwhich impactedbothOperating IncomeandComprehensiveFinancingExpense(“CFE”)in3Q17.


CAPITAL EXPENDITURES AND ACQUISITIONS; NET DEBT

Consolidated capital expendituresandacquisitions totaledUS$250million in4Q17.All subsidiaries continued tomakeprogressontheirinvestmentplansasdiscussedintheinitialsectionofthisreport.Atquarter-end4Q17,ALFA’sNetDebtamountedtoUS$6,300million,US$456millionhigherthan4Q16.Attheendofthequarter,financialratioswere:NetDebttoEBITDA,3.1times;InterestCoverage,4.6times.Theseratioscompareto2.5timesand6.6times,respectivelyin4Q16.


ALFATABLE1|VOLUMEANDPRICECHANGES(%)

4Q17vs. YTD.17VS 3Q17 4Q16 YTD.16TotalVolume 1.5 8.6 7.7DomesticVolume (0.1) 10.0 12.6ForeignVolume 3.2 7.3 3.2Avg.Ps.Prices 5.1 (2.4) 0.4Avg.US$Prices (1.0) 2.1 (1.0)

TABLE2|REVENUES

(%)4Q17VS. 4Q17 3Q17 4Q16 3Q17 4Q16 YTD.17 YTD.16 Ch.%TOTALREVENUES Ps.Millions 81,345 76,235 76,713 7 6 317,627 293,782 8US$Millions 4,297 4,278 3,874 - 11 16,804 15,756 7

DOMESTICREVENUES Ps.Millions 27,590 26,719 27,213 3 1 110,615 103,290 7US$Millions 1,457 1,499 1,373 (3) 6 5,853 5,539 6

FOREIGNREVENUES Ps.Millions 53,755 49,516 49,500 9 9 207,012 190,492 9US$Millions 2,840 2,779 2,500 2 14 10,951 10,217 7Foreign/Total(%) 66 65 65 65 65

TABLE3|OPERATINGINCOMEANDEBITDA

(%)4Q17VS. 4Q17 3Q17 4Q16 3Q17 4Q16 YTD.17 YTD.16 Ch.%OPERATINGINCOME Ps.Millions 5,447 (5,367) 3,734 202 46 11,195 24,214 (54)US$Millions 288 (302) 192 196 50 557 1,313 (58)

EBITDA Ps.Millions 10,751 7,134 10,709 51 - 38,312 43,254 (11)US$Millions 568 400 540 42 5 2,018 2,322 (13)

TABLE4|COMPREHENSIVEFINANCING(EXPENSE)/INCOME(CFI)(US$MILLIONS)

(%)4Q17VS. 4Q17 3Q17 4Q16 3Q17 4Q16 YTD.17 YTD.16 Ch.%FinancialExpenses (140) (114) (70) (22) (99) (493) (384) (29)FinancialIncome 27 8 9 233 186 55 31 77NetFinancialExpenses (113) (106) (61) (6) (86) (438) (352) (25)FxGains(Losses) (223) (74) (127) (201) (76) (80) (383) 79FinancialAssetImpairment 0 (95) 0 (100) - (95) 0 (100)PREvaluation 0 0 0 - - 0 (69) 100CapitalizedCFE 7 4 5 65 52 18 6 198CFE (329) (271) (183) (21) (80) (595) (798) 25Avg.CostofBorrowedFunds(%) 4.9 4.8 4.9 5.0 4.8


ALFATABLE5|MAJORITYNETINCOME(US$MILLIONS)

(%)4Q17VS. 4Q17 3Q17 4Q16 3Q17 4Q16 YTD.17 YTD.16 Ch.%ConsolidatedNetIncome(Loss) (44) (417) (54) 89 18 (109) 276 (140)MinorityInterest (13) (83) 6 84 (327) 25 134 (82)MajorityNetIncome(Loss) (31) (333) (59) 91 48 (134) 142 (194)PerShare(USDollars) (0.01) (0.07) (0.01) (540) (2,608) (0.03) 0.03 (151)Avg.OutstandingShares(Millions) 5,067 5,086 5,121 5,088 5,121 TABLE6|CASHFLOW(US$MILLIONS)

(%)4Q17VS. 4Q17 3Q17 4Q16 3Q17 4Q16 YTD.17 YTD.16 Ch.%EBITDA 568 400 540 42 5 2,018 2,322 (13)NetWorkingCapital&Others 315 56 232 463 36 97 (71) 237CapitalExpenditures&Acquisitions (250) (326) (450) 23 44 (1,101) (1,491) 26NetFinancialExpenses (135) (103) (60) (31) (125) (465) (369) (26)Taxes (57) (57) (58) - 2 (255) (290) 12Dividends(ALFA,S.A.B.) 0 0 0 - - (170) (172) 1OtherSources/Uses (196) (114) (105) (72) (87) (580) (987) 41Decrease(Increase)inNetDebt 245 (144) 99 270 147 (456) (1,059) 57TABLE7|SELECTEDBALANCESHEETINFORMATION&FINANCIALRATIOS(US$MILLIONS) 4Q17 3Q17 4Q16 YTD.17 YTD.16Assets 18,189 18,002 16,868 18,189 16,868Liabilities 13,506 13,182 11,999 13,506 11,999Stockholders’Equity 4,683 4,821 4,869 4,683 4,869MajorityEquity 3,518 3,608 3,667 3,518 3,667NetDebt 6,300 6,545 5,844 6,300 5,844NetDebt/EBITDA* 3.1 3.3 2.5 3.1 2.5InterestCoverage* 4.6 5.1 6.6 4.6 6.6*Times:LTM=Last12months

AppendixAALFA,S.A.B.deC.V.andSubsidiariesBALANCESHEETInformationinmillionsofNominalMexicanPesos

Dec-17 Jun-17 Dec-16 Sep17 Dec16ASSETS

CURRENTASSETS:Cashandcashequivalents 32,813 23,646 24,633 39 33Tradeaccountsreceivable 27,621 26,180 28,850 6 (4)Otheraccountsandnotesreceivable 7,286 6,816 6,441 7 13Inventories 44,341 40,515 40,923 9 8Othercurrentassets 10,074 11,633 10,921 (13) (8)Totalcurrentassets 122,135 108,790 111,768 12 9

INVESTMENTSINASSOCIATESANDJOINTVENTURES 1,455 1,299 2,111 12 (31)PROPERTY,PLANTANDEQUIPMENT 153,642 143,556 149,503 7 3INTANGIBLEASSETS 58,058 53,433 63,171 9 (8)OTHERNON-CURRENTASSETS 23,678 20,529 22,009 15 8

Totalassets 358,968 327,607 348,562 10 3LIABILITIESANDSTOCKHOLDER'SEQUITY

CURRENTLIABILITIES:Currentportionoflong-termdebt 2,454 2,591 2,614 (5) (6)Bankloansandnotespayable 12,692 11,149 6,193 14 105Suppliers 61,214 51,131 53,729 20 14Othercurrentliabilities 21,834 20,176 20,470 8 7Totalcurrentliabilities 98,194 85,048 83,006 15 18LONG-TERMLIABILITIES:Long-termdebt 143,816 130,865 136,323 10 5Deferredincometaxes 13,874 13,577 16,228 2 (15)Otherliabilities 5,677 5,759 7,890 (1) (28)Estimatedliabilitiesforsenioritypremiumsandpensionplans 4,982 4,626 4,502 8 11

Totalliabilities 266,542 239,876 247,950 11 7STOCKHOLDERS'EQUITY:Controllinginterest:Capitalstock 211 212 213 (1) (1)

Contributedcapital 211 212 213 (1) (1)Earnedsurplus 69,227 65,445 75,562 6 (8)Totalcontrollinginterest 69,437 65,657 75,776 6 (8)TotalNon-controllinginterest 22,989 22,073 24,837 4 (7)

Totalstockholders'equity 92,427 87,731 100,613 5 (8)Totalliabilitiesandstockholders'equity 358,968 327,607 348,563 10 3Currentratio 1.24 1.28 1.35Debttoequity 2.88 2.73 2.46

(%)Dec17vs.

AppendixBALFA,S.A.B.DEC.V.andSubsidiariesSTATEMENTOFCOMPREHENSIVEINCOMEInformationinmillionsofNominalMexicanPesos

4Q17 3Q17 4Q16 YTD'17 YTD'16 3Q17 4Q16Netsales 81,345 76,235 76,713 317,627 293,782 7 6

Domestic 27,590 26,719 27,213 110,615 103,290 3 1Export 53,755 49,516 49,500 207,012 190,492 9 9

Costofsales (64,817) (61,368) (59,773) (254,284) (226,422) (6) (8)

Grossprofit 16,528 14,867 16,940 63,344 67,360 11 (2)Operatingexpensesandothers (11,081) (20,233) (13,206) (52,149) (43,146) 45 16

Operatingincome 5,447 (5,367) 3,734 11,195 24,214 202 46Comprehensivefinancingexpense,net (6,222) (4,823) (3,711) (10,912) (15,058) (29) (68)Equityinincome(loss)ofassociates 17 5 77 92 115 220 (78)

Incomebeforethefollowingprovision (758) (10,184) 100 375 9,271 93 (856)Provisionsfor:Incometax (83) 2,759 (1,274) (1,803) (4,536) (103) 93

Consolidatednetincome (841) (7,426) (1,173) (1,427) 4,735 89 28

Income(loss)correspondingtominorityinterest (251) (1,487) 92 624 2,410 83 (374)

Netincome(loss)correspondingtomajorityinterest (590) (5,939) (1,265) (2,051) 2,325 90 53EBITDA 10,751 7,134 10,709 38,312 43,254 51 0Interestcoverage* 4.6 5.2 6.6 4.6 6.6*LTM

4Q17vs.(%)


LUIS OCHOA +52 (81) 8748. 2521

[email protected]

JUAN ANDRÉS MARTÍN

+52 (81) 8748.1141

[email protected]

MARCELA ELIZONDO

+52 (81) 8748.1223

[email protected]

INSPIR GROUP SUSAN BORINELLI+1 (646) 330.5907

[email protected]

APPENDIX: A SIGMA 11 B ALPEK 17 C NEMAK 30 D AXTEL 38 E NEWPEK 48


SIGMA | REFRIGERATED FOOD PRODUCTS 37% AND 34% OF ALFA´S REVENUES AND EBITDA IN 4Q17 Sigmaisaleadingmultinationalrefrigeratedfoodcompanythatproduces,marketsanddistributesqualitybrandedfoods,includingpackagedmeats, cheese, yogurt andother refrigeratedand frozen foods. Sigmahas adiversifiedportfolioofleadingbrandsandoperates70plantsin18countriesacrossitsfourkeyregions:Mexico,Europe,theUnitedStates,andLatinAmerica.

SELECTED FINANCIAL INFORMATION

SELECTEDFINANCIALINFORMATION(US$MILLION)

4Q17 3Q17 4Q16

CH.%VS.3Q17

CH.%VS.4Q16

YTD.‘17

YTD.‘16

YTDChg.%

TOTALREVENUES 1,593 1,608 1,438 (1) 11 6,054 5,698 6Europe 607 571 534 6 14 2,146 2,027 6Mexico 636 668 579 (5) 10 2,496 2,329 7USA 227 251 219 (9) 4 966 935 3Latam 123 119 106 4 16 446 407 10

TOTALEBITDA 195 179 166 9 18 676 663 2Europe 64 45 44 43 45 177 151 17Mexico 84 90 76 (6) 11 322 319 1USA 36 36 34 - 6 139 148 (6)Latam 11 9 11 25 (7) 38 45 (16)

CAPITALEXPENDITURES 71 34 157 106 (55) 188 328 (43)NETDEBT 1,936 2,037 1,724 (5) 12 1,936 1,724 12NetDebt/LTMEBITDA* 2.9 3.1 2.6 2.9 2.6 LTMInterestCoverage* 4.7 4.6 5.5 4.7 5.5

*Times.UDM=Last12months

INDUSTRY COMMENTS

During4Q17,consumerconfidencewashigheryear-on-yearacrossallofSigma’smainregionsofoperations.InMexico,theaverageconsumerconfidenceindexreportedbyINEGI(InstitutoNacionaldeEstadísticayGeografía–NationalInstituteforStatisticsandGeography)recoveredsteadilythroughouttheyearandwasup4%year-on-year,butatsimilarlevelswith3Q17; while same-store sales reported by the National Association of Supermarkets and Department Stores (ANTAD)increased4%year-on-year innominalpesos. InEurope,accordingto theEuropeanCommission, theaverageconsumerconfidenceindexfor4Q17improvedtonegative0.2,fromnegative6.5during4Q16,reachinga10-yearhigh.IntheU.S.,theaverageconsumerconfidenceindexincreasedto126in4Q17from108during4Q16asreportedbyTheConferenceBoard,thehighestlevelsince2000.FoodretailsalesreportedbytheUSCensusBureauincreased4%year-on-year.WhileinEurope,foodretailsalesincreased1%,accordingtoEurostat.

Keyrawmaterialpricesweremixedduringthequarterandvariedbyregion.IntheAmericas,porkpriceswereflatwhencomparedto4Q16.Inturn,turkeybreastandturkeythighswere21%and19%lower,respectively,whilechickenwas19%higherthanthesameperiodoftheprioryear.Comparedtothepreviousquarter,porkhamdecreased8%,whileotherrawmaterialspriceswerestable.InMexico,theappreciationofthePesovis-a-vistheUSDollarhaseasedthepressureinthecost of raw materials, as the industry participants import most of its meats from the US. In Europe, prices for hamdecreasedsharplyduring4Q17andwasonaverage6%lowerthan4Q16,whileporkshoulderwassimilarto4Q16.Forthefullyear,porkhamandporkshoulderpricesinEuropewere8%and15%higherthan2016,respectively.


FINANCIAL RESULTS BY REGION

Europe

During4Q17,Europeanrevenueineurosincreased4%year-on-year,benefitingfromtheconsolidationoftheSeptember2017 acquisition of Caroli in Romania. 4Q17 EBITDA increased 32% year-on-year, which includes 11 million Euros ofextraordinarygainrelatedtotheacquisitionofCaroli.ExcludingthiseffectEBITDAincreased4%.

Forthefullyear2017,sales increased3%andEBITDA12%comparedto2016.Yearlyresults inEuropewerenegativelyimpactedby start-up costs for the LaBurebaplant andhigher rawmaterials andbenefitedby20millionEurosby theextraordinarygainsrelatedtotheCaroliacquisition.

Mexico

Fourth quarter sales inMexico in pesos increased 5% year-on-year, reflecting a slight increase in volume and higheraverageprices.4Q17EBITDAinpesosincreased6%year-on-year,benefittingfromslightlyhighermarginsthan4Q16.SalesintheFoodservicechannelhadapositiveimpactonresults.

Fortheyear2017,salesincreased8%duetohighervolumesandhigheraverageprices.EBITDAincreased2%comparedto2016.Resultswereimpactedbylowermarginsatthebeginningoftheyearcausedbyasharppesodepreciation,howevermarginsimprovedaspriceincreaseswereimplemented.

USA

4Q17U.S. sales increased 4% and EBITDA increased 6% year-on-year, as results benefited fromhigher average prices.Fourthquarterrevenuesforallthreemainbusinesssegmentsintheregiongrewyear-on-year.

Fortheyear2017,salesincreased3%andEBITDAdecreased6%comparedto2016.RawmaterialscostincreasesduringthefirsthalfoftheyearimpactedEBITDAasmostofthepriceincreasesflowedthroughduringthesecondhalfoftheyear,whichhelpedimprovemarginsinthelasttwoquarters.

Latam

Fourthquarter2017LatinAmericasalesinUSDincreased16%year-on-year,benefitedfromtheacquisitionofSupemsaattheendof 2Q17. Excluding this acquisition4Q17 saleswere flatwith4Q16. 4Q17EBITDAdecreased7%year-on-year,mainlyimpactedbyareclassificationofcostsandexpensesfromMexicanoperations.

Fortheyear2017,salesinUSDincreased10%andEBITDAdecreased16%.

CONSOLIDATED FINANCIAL RESULTS

During4Q17,Sigma´srevenueswereU.S.$1,593million,anincreaseof11%versus4Q16.Sigmasoldapproximately437thousandtonsoffoodproducts,up3%from4Q16,mainlyduetogrowthinMexicoandU.S.,andtheCaroliandSupemsaacquisitions.Indollarterms,averagepricesincreased8%year-on-year,stemmingfromhigherpricesinAmericasregionsandaweakerUSdollaragainsttheEuroandPeso.

SalesinMexicoaccountedfor40%ofthequarter’stotal,whileEuroperepresented38%,theU.S.14%,andLatinAmerica8%.During2017,revenueswereU.S.$6,054million,up6%whencomparedtothesameperiodof2016


Operating Income and EBITDAwere U.S. $132million and U.S. $195million in 4Q17, up 24% and 18% year-on-year,respectively. This increasewas primarily due to the performanceofMexican andU.S. operations, the consolidationofSupemsaandCaroli,anextraordinarygainrelatedtotheacquisitionofCaroliandamorefavorablecurrencyenvironmentinEuropeandMexico.In2017,OperatingIncomeandEBITDAwereU.S.$458millionandU.S.$676million,unchangedand2%higherthan2016,respectively.

CAPITAL EXPENDITURES AND ACQUISITIONS; NET DEBT

During4Q17,capitalexpenditureswereU.S.$71million,thesefundswereutilizedforthenewplantinBurgos,Spain,otherfixed assets andminor projects across the company. The investment in La Bureba plant is complete and during 4Q17productioncontinuedfortheSpanishandotherEuropeanmarkets.

At the end of 4Q17, Net Debt was U.S. $1,936million, up 12% from 4Q16,mainly explained by the payment of theconstructionoftheBurebafacilityandtheacquisitionsofSupemsaandCaroli.Financialratiosattheendof4Q17were:NetDebttoEBITDA,2.9times;InterestCoverage,4.7times.


SIGMA

TABLE1|VOLUMEANDPRICECHANGES(%)

4Q17vs. YTD.17VS 3Q17 4Q16 YTD.16

TotalVolume (0.2) 2.8 2.5Avg.Ps.Prices 5.5 2.9 4.8Avg.US$Prices (0.7) 7.8 3.7TABLE2|REVENUES

(%)4Q17VS. 4Q17 3Q17 4Q16 3Q17 4Q16 YTD.17 YTD.16 Ch.%TOTALREVENUES Ps.Millions 30,162 28,658 28,521 5 6 114,222 106,341 7US$Millions 1,593 1,608 1,438 (1) 11 6,054 5,698 6

DOMESTICREVENUES Ps.Millions 12,042 11,902 11,484 1 5 47,078 43,432 8US$Millions 636 668 579 (5) 10 2,496 2,329 7

FOREIGNREVENUES Ps.Millions 18,120 16,757 17,037 8 6 67,144 62,908 7US$Millions 957 940 859 2 11 3,558 3,369 6Foreign/Total(%) 60 58 60 59 59


(%)4Q17VS. 4Q17 3Q17 4Q16 3Q17 4Q16 YTD.17 YTD.16 Ch.%OPERATINGINCOME Ps.Millions 2,495 2,229 2,095 12 19 8,591 8,519 1US$Millions 132 125 106 5 24 458 458 -EBITDA Ps.Millions 3,699 3,192 3,295 16 12 12,725 12,374 3US$Millions 195 179 166 9 18 676 663 2TABLE4|SELECTEDBALANCESHEETINFORMATION&FINANCIALRATIOS(US$MILLIONS)

4Q17 3Q17 4Q16 YTD.17 YTD.16Assets 5,350 5,365 4,876 5,350 4,876Liabilities 4,423 4,407 4,051 4,423 4,051Stockholders’Equity 927 958 825 927 825MajorityEquity 892 925 795 892 795NetDebt 1,936 2,037 1,724 1,936 1,724NetDebt/EBITDA* 2.9 3.2 2.6 2.9 2.6InterestCoverage* 4.7 4.6 5.5 4.7 5.5*Times:LTM=Last12months

AppendixASigmaAlimentos,S.A.deC.V.andSubsidiariesBALANCESHEETInformationinmillionsofNominalMexicanPesos

(%)Dec17vs.Dec-17 Sep-17 Dec-16 Sep17 Dec16

ASSETSCURRENTASSETS:

Cashandcashequivalents 12,807,070 10,098,380 12,837,614 27 (0)Restrictedcash 84,855 149,219 123,973 (43) (32)Customers,net 5,776,360 6,201,437 6,662,529 (7) (13)Incometaxrecoverable 819,476 826,823 846,056 (1) (3)Inventories 14,687,050 14,583,982 13,751,274 1 7Othercurrentassets 2,626,694 3,168,138 2,720,783 (17) (3)Totalcurrentassets 36,801,505 35,027,980 36,942,229 5 (0)

NON-CURRENTASSETS:Property,plantandequipment,net 35,268,405 32,807,778 33,089,282 8 7Intangibleassets,net 15,714,594 14,516,197 15,753,001 8 (0)Goodwill 14,742,249 12,946,049 10,911,844 14 35Deferredincometax 2,792,463 2,100,858 2,995,464 33 (7)Investmentsinassociatesandjointventures 92,996 89,253 945,968 4 (90)Othernon-currentassets 174,005 141,838 122,980 23 41Totalnon-currentassets 68,784,712 62,601,972 63,818,540 10 8

Totalassets 105,586,217 97,629,952 100,760,769 8 5LIABILITIESANDSTOCKHOLDERS'EQUITY

CURRENTLIABILITIES:Currentdebt 2,379,616 2,470,052 442,238 (4) 438Notespayables 70,146 65,091 57,415 8 22Suppliers 20,866,955 18,220,841 21,376,345 15 (2)Incometaxpayable 1,783,816 1,739,837 667,648 3 167Provisions 323,565 181,787 211,005 78 53Othercurrentliabilities 5,183,749 5,044,442 4,964,414 3 4Totalcurrentliabilities 30,607,848 27,722,050 27,719,065 10 10

NON-CURRENTLIABILITIES:Non-currentdebt 48,029,505 44,108,759 47,400,372 9 1Notespayables 313,932 314,423 345,805 (0) (9)Deferredincometaxes 4,068,122 4,113,576 3,846,026 (1) 6Employeesbenefits 1,339,070 1,190,334 1,117,998 12 20Provisions 110,133 153,733 348,473 (28) (68)Incometaxpayable 2,341,907 2,120,911 2,460,047 10 (5)Othernon-currentliabilities 486,305 467,828 475,414 4 2Totalpasivoalargoplazo 56,688,973 52,469,564 55,994,135 8 1

Totalliabilities 87,296,821 80,191,614 83,713,200 9 4STOCKHOLDERS'EQUITYTotalcontrollinginterest: 17,597,331 16,828,274 16,429,586 5 7Totalnon-controllinginterest: 692,065 610,064 617,983 13 12

Totalstockholders'equity 18,289,396 17,438,338 17,047,569 5 7Totalliabilitiesandstockholders'equity 105,586,217 97,629,952 100,760,769 8 5

AppendixBSigmaAlimentos,S.A.deC.V.andSubsidiariesSTATEMENTOFCOMPREHENSIVEINCOMEInformationinmillionsofNominalMexicanPesos

4Q17 3Q17 4Q16 YTD'17 YTD'16 3Q17 4Q16

Revenue 30,161,640 28,658,206 28,521,486 114,222,039 106,340,864 5 # 6

Costofsales (21,941,195) (20,695,299) (20,602,173) (82,748,224) (75,369,775) 6 6

Grossprofit 8,220,446 7,962,907 7,919,312 31,473,815 30,971,089 3 4

Sellingexpenses (4,676,555) (4,653,978) (4,393,911) (18,266,369) (17,397,744) 0 6

Administrativeexpenses (1,072,429) (1,272,425) (1,102,005) (4,780,769) (4,578,817) (16) (3)

Otherincome(expenses),net 23,155 192,170 (328,161) 164,064 (475,656) (88) (107)

Operatingprofit 2,494,617 2,228,675 2,095,235 8,590,741 8,518,872 12 19

Comprehensivefinancialexpenses,net (1,057,380) (888,586) (696,620) (4,388,909) (2,756,969) 19 52

Equityinincome(loss)ofassociates (383) 9,258 16,329 15,976 50,236 (104) (102)

Profitbeforeincometax 1,436,854 1,349,347 1,414,943 4,217,808 5,812,139 6 2

Provisionsfor:

Incometax 257,877 (330,001) (103,932) (2,143,965) (859,554) (178) (348)

Netconsolidatedprofit 1,694,732 1,019,345 1,311,011 2,073,843 4,952,585 66 29

Non-controllinginterest 22,088 12,821 13,816 41,952 33,419 72 60

Controllinginterest 1,672,644 1,006,525 1,297,194 2,031,891 4,919,166 66 29

4Q17vs.(%)

Fourth Quarter 2017 (4Q17) |

This release contains forward‐looking information based on numerous variables and assumptions that are inherently uncertain. They involve judgments with respect to, among other things, future economic, competitive and financial market conditions and future business decisions, all of which are difficult or impossible to predict accurately. Accordingly, results could vary from those set forth in this release. The report presents unaudited financial information based on International Financial Reporting Standards (IFRS). Figures are stated in nominal Mexican pesos ($) and in current U.S. Dollars (U.S. $), as indicated. Where applicable, peso amounts were translated into U.S. Dollars using the average exchange rate of the months during which operations were recorded. Financial ratios are calculated in U.S. Dollars. Due to the rounding up of figures, small differences may occur when calculating percent changes from one period to the other.

Monterrey, Mexico. February 12, 2018 – Alpek, S.A.B. de C.V. (BMV: ALPEK)

Alpek reports 4Q17 EBITDA of U.S. $141 million

Selected Financial Information (U.S. $ Millions)

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Total Volume (ktons) 975 1,012 970 (4) 1 4,012 3,938 2

Polyester 752 788 749 (5) - 3,105 3,004 3

Plastics & Chemicals 224 225 221 - 1 906 934 (3)

Consolidated Revenues 1,321 1,312 1,183 1 12 5,231 4,838 8

Polyester 933 945 851 (1) 10 3,724 3,444 8

Plastics & Chemicals 388 367 332 6 17 1,506 1,394 8

Consolidated EBITDA 141 3 133 4,241 6 384 669 (43)

Polyester 77 (51) 82 253 (6) 147 349 (58)

Plastics & Chemicals 64 54 52 18 21 237 322 (26)

Profit Attributable to Controlling Interest (30) (400) 28 92 (209) (319) 198 (261)

CAPEX and Acquisitions 30 64 75 (54) (60) 236 345 (32)

Net Debt 1,262 1,192 1,042 6 21

Net Debt/LTM EBITDA(1) 3.3 3.2 1.6

Interest Coverage(1) 4.8 5.4 10.5 (1) Times: Last 12 months

Operating & Financial Highlights (4Q17)

Alpek

• 4Q17 Consolidated EBITDA of U.S. $141 million, including a U.S. $16 million non-cash

inventory gain; rapid recovery after 3Q17

• Cogeneration power plants’ sale process advanced with ContourGlobal

• 3.3 times Net Debt/EBITDA; 2.5 times excluding M&G A/R provision (U.S. -$113 million)

Polyester

• M&G Mexico resumed PET production in 4Q17; Alpek supplies PTA via tolling agreement and

secured credit facility

• The Court of the Administrative Council for Economic Defense in Brazil (CADE) approved the

acquisition of PetroquímicaSuape and Citepe

• PET antidumping cases moving forward in the United States and Canada

Plastics &

Chemicals

(P&C)

• 4Q17 P&C EBITDA of U.S. $64 million, including a U.S. $5 million non-cash inventory gain

• Margin expansion in polypropylene (PP) and caprolactam (CPL) more than offset flat 4Q17

volume


[email protected]

www.alpek.com 2

Message from the CEO

Alpek’s Consolidated EBITDA returned to a normalized level in the fourth quarter, supported by solid

performance in both business segments. The restart of M&G Polímeros México, S.A. de C.V. (M&G Mexico), robust

polypropylene (PP) margins and a rising oil price environment contributed to a rapid recovery after 3Q17.

Consolidated 4Q17 EBITDA was U.S. $141 million, including a U.S. $16 million non-cash inventory gain. Higher

feedstock prices resulted in an U.S. $11 million inventory gain in Polyester and a U.S. $5 million gain in Plastics &

Chemicals (P&C). Adjusting for inventory gains and the U.S. -$113 million M&G A/R provision in 3Q17, Comparable

4Q17 Consolidated EBITDA was up 6% and 15% versus 4Q16 and 3Q17 respectively.

Comparable 4Q17 Polyester EBITDA increased 22% quarter-on-quarter to U.S. $66 million as M&G Mexico

resumed operations and PET margins posted a sequential recovery amid rising oil and feedstock prices. In addition,

the P&C segment closed the year with Comparable EBITDA of U.S. $59 million, its fourth consecutive quarter above

Guidance driven by higher than expected PP margins.

In November 2017, M&G Mexico resumed PET production under a temporary tolling agreement with Alpek,

who supplies the required feedstocks (e.g. PTA and MEG) and pays a tolling fee in exchange for PET from the Altamira

facility. The tolling agreement was recently complemented by a credit agreement through which Alpek will provide

up to U.S. $60 million in secured financing to M&G Mexico subject to certain conditions. The combination of tolling

and credit agreement is intended to support M&G Mexico’s PET operations while a permanent restructuring plan is

presented to Alpek and other creditors. Alpek’s priorities in M&G Mexico’s restructuring process are: i) maximizing

the recovery of its claims and ii) maintaining its PTA supply to the restructured entity.

The restructuring process associated to the integrated PTA-PET plant that was being constructed by M&G in

Corpus Christi, TX also advanced during 4Q17. M&G USA Corporation (M&G USA) filed for bankruptcy in Delaware

and received approval to begin the sale of certain assets, including the Corpus Christi plant. Bidding procedures are

scheduled to occur in 1Q18. Alpek’s priority in M&G USA’s restructuring process is to reaffirm its Corpus Christi

capacity rights under the original agreements or as a bidder for the Corpus Christi assets.

Other key, ongoing events include: i) the formal sale process of our two cogeneration power plants, ii) the

evaluation process by the Court of the Administrative Council for Economic Defense (CADE), and iii) the PET

antidumping cases in the United States and Canada.

During 4Q17, Alpek selected ContourGlobal and moved forward in the sale process of its cogeneration power

plants in Cosoleacaque and Altamira, Mexico.

In Brazil, the CADE Court approved the acquisition of PetroquímicaSuape and Citepe from Petrobras. As part

of the approval process, Alpek proposed entering into a merger control agreement (Acordo de Controle de

Concentração – ACC), committing to maintain an environment of effective competition.

Regarding the PET antidumping cases, the United States Department of Commerce (USDOC) initiated its

investigations and the United States International Trade Commission (USITC) issued a preliminary determination of

material injury caused by PET imports from Brazil, Indonesia, Korea, Pakistan and Taiwan. Separately, the Canada

Border Services Agency (CBSA) imposed preliminary duties ranging from 22% to 77% on PET imports from China, India,

Oman and Pakistan.


[email protected]

www.alpek.com 3

On the investment front, Capex was U.S. $30 million in 4Q17 and totaled U.S. $236 million in 2017, as planned.

Our strategic capex program reached an important milestone this year with the start-up of two projects; the propylene

storage spheres and the expandable polystyrene (EPS) capacity expansion in Mexico. Moreover, progress continued

in the 350 MW Altamira cogeneration power plant as approximately 80% of the total investment had been disbursed

at the close of 2017.

Alpek maintains a solid financial position supported by a strong balance sheet and liquidity. At the close of

4Q17, Net Debt totaled U.S. $1.262 billion and Net Debt to EBITDA was 3.3 times or 2.5 times when adjusted for the

U.S. -$113 million M&G A/R provision that affected EBITDA in 3Q17. Furthermore, the balance of Cash and Cash

Equivalents was U.S. $484 million as of year-end.

We have an optimistic outlook for 2018 as we anticipate continuous M&G Mexico PET plant operations, PET

margin recovery from the 2017 multi-year low and a higher annual average Brent oil price. 2018 Guidance will be

disclosed tomorrow, prior to our 4Q17 Conference Call.


[email protected]

www.alpek.com 4

Results by Business Segment

Polyester (Purified Terephthalic Acid (PTA), Polyethylene Terephthalate (PET), Polyester fibers – 71% of Alpek’s Net Sales)

Fourth quarter 2017 Polyester revenue was up 10% year-on-year and down 1% quarter-on-quarter amid a

higher price environment. Average 4Q17 Polyester prices increased 9% and 3% when compared with 4Q16 and 3Q17,

respectively, reflecting the rise in feedstock prices such as paraxylene. For the full-year 2017, revenue was up 8%

versus 2016 as average prices increased 5% and volume was 3% higher.

4Q17 Polyester volume was flat when compared to 4Q16 and down 5% versus 3Q17. Lower PTA volume

supplied to M&G in Mexico and Brazil were partially offset by incremental PET sales during 4Q17. In contrast, 2017

segment volume was 3% higher than in 2016 as the M&G PTA supply disruption was more than offset by the

integration of Selenis Canada Inc. (PET), plus organic PET volume growth in the United States, Mexico and Argentina.

Fourth quarter 2017 segment EBITDA was U.S. $77 million, including an U.S. $11 million non-cash inventory

gain. Adjusting for inventory gains and the U.S. -$113 million M&G A/R provision in 3Q17, Comparable 4Q17 Polyester

EBITDA was U.S. $66 million, flat when compared to 4Q16 and up 22% when compared with 3Q17. The M&G Mexico

restart, PET margin recovery and a rising feedstock price environment contributed to Comparable Polyester EBITDA

growth quarter-on-quarter. For the full-year 2017, Polyester EBITDA was U.S. $147 million, including the M&G A/R

provision, a U.S. $14 million non-cash inventory gain and a U.S. $12 million one-time gain from the Selenis Canada

Inc. acquisition (2016). Comparable 2017 Polyester EBITDA was U.S. $234 million, down 29% versus 2016 affected

primarily by lower PET margins, the M&G PTA supply disruption and higher secondary feedstock costs

(e.g. isophthalic acid or IPA).

Plastics & Chemicals (P&C) (Polypropylene (PP), Expandable Polystyrene (EPS), Caprolactam (CPL), Other products – 29% of Alpek’s Net Sales)

4Q17 P&C revenue increased 17% year-on-year and 6% quarter-on-quarter due to higher average prices.

Average fourth quarter 2017 P&C prices were up 15% and 6% when compared with 4Q16 and 3Q17 respectively,

driven mainly by the rise in feedstock prices such as propylene and styrene. For the full year 2017, revenue grew 8%

versus 2016 as lower volume was more than offset by an 11% increase in average prices.

Fourth quarter 2017 P&C volume was up 1% year-on-year and flat when compared to 3Q17. On an annual

basis, 2017 P&C volume was 3% lower than 2016 as unplanned refinery outages in Mexico weighed on propylene

supply. Also, lower domestic ethylene oxide and ammonia supply affected Alpek’s specialty chemical and

caprolactam businesses.

Segment EBITDA was U.S. $64 million in 4Q17, including a U.S. $5 million inventory gain. Adjusting for the

inventory gain, Comparable 4Q17 P&C EBITDA was U.S. $59 million, up 12% and 9% when compared with 4Q16 and

3Q17 driven by PP and CPL. For the full-year 2017, P&C EBITDA was U.S. $237 million, including an U.S. $8 million non-

cash inventory gain. Comparable P&C EBITDA was U.S. $229 million, 26% lower than 2016 which benefited from record

PP and EPS EBITDA. However, P&C EBITDA was consistently above 2017 Guidance.


[email protected]

www.alpek.com 5

Consolidated Financial Results

Net Sales: Net Sales for the fourth quarter totaled U.S. $1.3 billion, up 12% year-on-year and 1% quarter-on-

quarter, mainly due to higher average consolidated prices in both business segments. Average 4Q17 consolidated

prices increased 11% and 5% when compared with 4Q16 and 3Q17, respectively. 4Q17 consolidated volume was up

1% year-on-year and down 4% quarter-on-quarter. Accumulated net sales as of December 31, 2017 totaled U.S. $5.2

billion, 8% higher than 2016 driven by increases of 6% and 2% in average prices and volume respectively.

EBITDA: 4Q17 EBITDA was U.S. $141 million, including a U.S. $16 million non-cash inventory gain. Adjusting for the

inventory gain, Comparable Consolidated EBITDA was U.S. $124 million, U.S. $108 million and U.S. $117 million in

4Q17, 3Q17 and 4Q16 respectively. Accumulated EBITDA as of December 31, 2017 was U.S. $384 million, including

the U.S. -$113 million M&G A/R provision, a U.S. $22 million non-cash inventory gain and a U.S. $12 million one-time

gain from the Selenis Canada Inc. acquisition (2016). Comparable Consolidated 2017 EBITDA totaled U.S. $462 million,

down 27% versus 2016 mainly due to the anticipated margin contraction in PP and PET, plus the M&G PTA supply

disruption.

Profit (Loss) Attributable to Controlling Interest: Loss Attributable to Controlling Interest for the fourth

quarter of 2017 was U.S. -$30 million due to higher Income tax and Fx loss. As a result of the recent U.S. tax reform,

which lowered the corporate tax rate, 4Q17 Income tax includes a U.S. -$65 million adjustment to the U.S. $223

million deferred tax benefit related to M&G provisions and impairments. In addition, non-cash Fx loss totaled

U.S. $47 million in 4Q17 due to the depreciation of the Mexican Peso. Accumulated 2017 Loss Attributable to

Controlling Interest was U.S. -$319 million, including a net impact of U.S. -$481 million from non-recurring charges

associated to M&G affecting EBITDA, Operating Income, Financial Cost, Net and Income Tax. Adjusting for the non-

recurring M&G items, the 2017 Profit Attributable to Controlling Interest was U.S. $162 million, compared to U.S.

$198 million in 2016.

Capital Expenditures and Acquisitions (Capex): 4Q17 Capex was U.S. $30 million, compared to

U.S. $75 million and U.S. $64 million in 4Q16 and 3Q17 respectively. Year-to-date Capex of U.S. $236 million, 32%

lower than the same period last year as investment ramps down due to the completion of Alpek’s strategic project

program. The majority of these funds were invested in the 350 MW power cogeneration plant in Altamira, Mexico,

which advanced as planned.

Net Debt: Consolidated Net Debt as of December 31, 2017 was U.S. $1.262 billion, up 21% and 6% year-on-year

and quarter-on-quarter, respectively. On an absolute basis, Net Debt increased U.S. $70 million in 4Q17 as the

investment of U.S. $101 million in M&G secured credit rights acquired from Inbursa was partially offset with cash

from operations. As of December 31, 2017, Gross Debt was U.S. $1.747 billion and the Cash balance totaled U.S.

$484 million. Financial ratios at the close of 4Q17 were: Net Debt to EBITDA of 3.3 times and Interest Coverage of 4.8

times. Adjusting for the U.S. -$113 million M&G A/R provision, Net Debt to EBITDA was 2.5 times and Interest

Coverage was 6.2 times.


[email protected]

www.alpek.com 6

Appendix A - Tables

TABLE 1 | VOLUME (KTONS)

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Total Volume 975 1,012 970 (4) 1 4,012 3,938 2

Polyester 752 788 749 (5) - 3,105 3,004 3

Plastics and Chemicals 224 225 221 - 1 906 934 (3)

TABLE 2 | PRICE CHANGES (%)

(%) 4Q17 vs. YTD17 vs.

3Q17 4Q16 YTD16

Polyester

Avg. Ps. Prices 10 4 6

Avg. U.S. $ Prices 3 9 5

Plastics and Chemicals



Total



TABLE 3 | INCOME STATEMENT (U.S. $ Millions)

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Total Revenues 1,321 1,312 1,183 1 12 5,231 4,838 8

Gross Profit 162 126 142 29 15 544 714 (24)

Operating expenses and others (52) (596) (44) 91 (19) (732) (182) (303)

Operating income 110 (470) 98 123 13 (188) 532 (135)

Financial cost, net (68) (130) (36) 47 (92) (188) (133) (41)

Share of losses of associates - - - - - - - -

Income Tax (62) 206 (29) (130) (111) 106 (126) 184

Consolidated net income (20) (394) 33 95 (161) (271) 272 (199)

Controlling Interest (30) (400) 28 92 (209) (319) 198 (261)


[email protected]

www.alpek.com 7

TABLE 4 | REVENUES

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Total Revenues

Ps. Millions 25,010 23,374 23,428 7 7 98,998 90,192 10

U.S. $ Millions 1,321 1,312 1,183 1 12 5,231 4,838 8

Domestic Revenues

Ps. Millions 8,166 8,060 8,491 1 (4) 34,957 33,625 4

U.S. $ Millions 431 452 429 (5) 1 1,846 1,806 2

Foreign Revenues

Ps. Millions 16,844 15,314 14,937 10 13 64,042 56,567 13

U.S. $ Millions 890 859 754 4 18 3,385 3,032 12

Foreign / Total (%) 67 66 64 65 63

TABLE 5 | OPERATING INCOME AND EBITDA

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Operating Income

Ps. Millions 2,084 (8,377) 1,944 125 7 (2,854) 9,863 (129)

U.S. $ Millions 110 (470) 98 123 13 (188) 532 (135)

EBITDA

Ps. Millions 2,660 59 2,647 4,408 - 7,483 12,425 (40)

U.S. $ Millions 141 3 133 4,241 6 384 669 (43)

TABLE 6 | COMPARABLE EBITDA

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

EBITDA

Ps. Millions 2,660 59 2,647 4,408 - 7,483 12,425 (40)

U.S. $ Millions 141 3 133 4,241 6 384 669 (43)

Adjustments*

Ps. Millions (309) 1,863 (327) (117) 5 1,322 (622) 312

U.S. $ Millions (16) 105 (16) (116) (1) 79 (32) 346

Comparable EBITDA

Ps. Millions 2,350 1,922 2,320 22 1 8,806 11,803 (25)

U.S. $ Millions 124 108 117 15 6 462 637 (27) *Adjustments: Inventory and non-operating, one-time (gains) losses


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TABLE 7 | FINANCIAL COST, NET (U.S. $ Millions)

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Financial Expenses (23) (19) (17) (24) (38) (78) (76) (3)

Financial Income 2 2 4 13 (55) 10 15 (32)

Net Financial Expenses (21) (17) (13) (25) (68) (68) (61) (11)

Financial Assets Impairment - (95) - 100 - (95) - (100)

Fx Gains (Losses) (47) (18) (23) (166) (105) (25) (72) 66

Financial Cost, Net (68) (130) (36) 47 (92) (188) (133) (41)

TABLE 8 | NET INCOME (U.S. $ Millions)

(%)4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Consolidated Net Income (20) (394) 33 95 (161) (271) 272 (199)

Non-Controlling Interest 10 6 5 65 94 49 75 (35)

Controlling Interest (30) (400) 28 92 (209) (319) 198 (261)

Earnings per Share (U.S. Dollars) (0.01) (0.19) 0.01 92 (209) (0.15) 0.09 (261)

Avg. Outstanding Shares (Millions)* 2,117 2,117 2,117 2,117 2,117 * The same number of equivalent shares are considered in the periods presented

TABLE 9 | CASH FLOW (U.S. $ Millions)

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

EBITDA 141 3 133 4,241 6 384 669 (43)

Net Working Capital & Others (37) 29 (84) (228) 55 83 (183) 145

Capital Expenditures & Acq. (30) (64) (75) 54 60 (236) (345) 32

Financial Expenses (22) (17) (16) (27) (35) (72) (58) (25)

Income tax (9) (19) (22) 50 58 (87) (164) 47

Dividends (7) (71) (20) 90 64 (176) (225) 22

Payment affiliated companies - - 8 - (100) 1 68 (99)

Other Sources / Uses (105) 5 (50) (2,325) (108) (118) (83) (42)

Decrease (Increase) in Net Debt (70) (135) (127) 48 45 (221) (320) 31


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TABLE 10 | STATEMENT OF FINANCIAL POSITION & FINANCIAL RATIOS (U.S. $ Millions)

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16

Assets

Cash and cash equivalents 484 447 142 8 241

Trade accounts receivable 544 507 542 7 0

Inventories 829 726 719 14 15

Other current assets 280 296 254 (5) 11

Total current assets 2,138 1,975 1,656 8 29

Investment in associates and others 33 33 28 1 18

Property, plant and equipment, net 2,105 2,117 1,970 (1) 7

Goodwill and intangible assets, net 206 211 575 (2) (64)

Other non-current assets 270 227 200 19 35

Total assets 4,752 4,563 4,428 4 7

Liabilities & stockholders' equity

Debt 375 380 135 (1) 178

Suppliers 874 741 636 18 37

Other current liabilities 170 186 168 (9) 1

Total current liabilities 1,420 1,307 939 9 51

Debt (include debt issuance cost) 1,366 1,254 1,043 9 31

Employees´ benefits 54 61 59 (12) (9)

Other long term liabilities 308 312 367 (1) (16)

Total liabilities 3,147 2,935 2,409 7 31

Total stockholders' equity 1,604 1,628 2,019 (1) (21)

Total liabilities & stockholders' equity 4,752 4,563 4,428 4 7

Net Debt 1,262 1,192 1,042 6 21

Net Debt/EBITDA* 3.3 3.2 1.6

Interest Coverage* 4.8 5.4 10.5 * Times: last 12 months


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Polyester

TABLE 11 | REVENUES

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Total Revenues

Ps. Millions 17,668 16,836 16,862 5 5 70,477 64,241 10

U.S. $ Millions 933 945 851 (1) 10 3,724 3,444 8

Domestic Revenues

Ps. Millions 3,679 4,108 4,473 (10) (18) 17,446 17,092 2

U.S. $ Millions 194 230 226 (16) (14) 921 917 -

Foreign Revenues

Ps. Millions 13,989 12,727 12,389 10 13 53,031 47,149 12

U.S. $ Millions 739 714 625 3 18 2,804 2,528 11

Foreign / Total (%) 79 76 73 75 73


(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Operating Income

Ps. Millions 1,022 (9,208) 1,078 111 (5) (6,815) 4,487 (252)

U.S. $ Millions 54 (517) 54 110 (0) (396) 241 (264)

EBITDA

Ps. Millions 1,467 (899) 1,640 263 (11) 2,970 6,514 (54)

U.S. $ Millions 77 (51) 82 253 (6) 147 349 (58)


(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

EBITDA

Ps. Millions 1,467 (899) 1,640 263 (11) 2,970 6,514 (54)

U.S. $ Millions 77 (51) 82 253 (6) 147 349 (58)

Adjustments*

Ps. Millions (215) 1,864 (327) (112) 34 1,489 (370) 503

U.S. $ Millions (11) 105 (16) (111) 30 87 (18) 574

Comparable EBITDA

Ps. Millions 1,252 965 1,313 30 (5) 4,458 6,145 (27)

U.S. $ Millions 66 54 66 22 (0) 234 331 (29) *Adjustments: Inventory and non-operating, one-time (gains) losses


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Plastics & Chemicals

TABLE 14 | REVENUES

(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Total Revenues

Ps. Millions 7,342 6,538 6,566 12 12 28,522 25,951 10

U.S. $ Millions 388 367 332 6 17 1,506 1,394 8

Domestic Revenues

Ps. Millions 4,487 3,952 4,018 14 12 17,511 16,533 6

U.S. $ Millions 237 222 203 7 17 925 890 4

Foreign Revenues

Ps. Millions 2,855 2,587 2,548 10 12 11,011 9,418 17

U.S. $ Millions 151 145 129 4 17 581 505 15

Foreign / Total (%) 39 40 39 39 36


(%) 4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

Operating Income

Ps. Millions 1,071 832 898 29 19 3,966 5,413 (27)

U.S. $ Millions 57 47 45 22 25 208 293 (29)

EBITDA

Ps. Millions 1,203 959 1,039 25 16 4,519 5,948 (24)

U.S. $ Millions 64 54 52 18 21 237 322 (26)


(%)4Q17 vs.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 Ch.%

EBITDA

Ps. Millions 1,203 959 1,039 25 16 4,519 5,948 (24)

U.S. $ Millions 64 54 52 18 21 237 322 (26)

Adjustments*

Ps. Millions (94) (2) - (5,794) (100) (167) (253) 34

U.S. $ Millions (5) - - (100) (100) (8) (14) 41

Comparable EBITDA

Ps. Millions 1,108 958 1,039 16 7 4,352 5,695 (24)

U.S. $ Millions 59 54 52 9 12 229 308 (26) *Adjustments: Inventory and non-operating, one-time (gains) losses


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Appendix B – Financial Statements

Dec 17 Sep 17 Dec 16 Sep 17 Dec 16

ASSETS

CURRENT ASSETS:

Cash and cash equivalents 8,795 7,427 2,935 18 200

Trade accounts receivable 10,739 9,222 11,191 16 (4)

Other accounts and notes receivable 4,152 3,938 3,626 5 15

Inventories 16,364 13,204 14,853 24 10

Other current assets 2,142 2,145 1,616 (0) 33

Total current assets 42,192 35,936 34,221 17 23

Investment in associates and others 650 594 575 9 13

Property, plant and equipment, net 41,535 38,518 40,699 8 2

Goodwill and intangible assets,net 4,065 3,845 11,875 6 (66)

Other non-current assets 5,336 4,138 4,130 29 29

Total assets 93,778 83,031 91,500 13 2

LIABILITIES AND STOCKHOLDER'S EQUITY

CURRENT LIABILITIES:

Debt 7,408 6,910 2,787 7 166

Suppliers 17,255 13,493 13,151 28 31

Other current liabilities 3,356 3,385 3,469 (1) (3)

Total current liabilities 28,019 23,788 19,407 18 44

NON-CURRENT LIABILITIES:

Debt (include debt issuance cost) 26,958 22,818 21,551 18 25

Deferred income taxes 4,403 4,136 5,883 6 (25)

Other liabilities 1,673 1,549 1,710 8 (2)

Employees´ benefits 1,061 1,118 1,227 (5) (14)

Total liabilities 62,114 53,409 49,778 16 25

STOCKHOLDERS´ EQUITY:

Controlling interest:

Capital stock 6,048 6,048 6,048 - -

Share premium 9,071 9,071 9,071 - -

Contributed capital 15,119 15,119 15,119 - -

Earned surplus 11,797 10,153 21,954 16 (46)

Total controlling interest 26,916 25,272 37,073 7 (27)

Non-controlling interest 4,748 4,350 4,649 9 2

Total stockholders´equity 31,664 29,622 41,722 7 (24)

Total liabilities and stockholders´ equity 93,778 83,031 91,500 13 2

ALPEK, S.A.B. DE C.V. and Subsidiaries

(%) Dec 17 vs.

STATEMENT OF FINANCIAL POSITION

Information in Millions of Mexican Pesos


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ALPEK, S.A.B. DE C.V. and Subsidiaries

Information in Millions of Mexican Pesos

YTD17 vs. (%)

4Q17 3Q17 4Q16 3Q17 4Q16 YTD17 YTD16 YTD16

Revenues 25,010 23,374 23,428 7 7 98,998 90,192 10

Domestic 8,166 8,061 8,491 1 (4) 34,957 33,625 4

Export 16,844 15,313 14,937 10 13 64,041 56,567 13

Cost of sales (21,941) (21,133) (20,615) (4) (6) (88,598) (76,943) (15)

Gross profit 3,069 2,241 2,813 37 9 10,400 13,249 (22)

Operating expenses and others (985) (10,618) (869) 91 (13) (13,254) (3,386) (291)

Operating income 2,084 (8,377) 1,944 125 7 (2,854) 9,863 (129)

Financial cost, net (1,296) (2,312) (719) 44 (80) (3,410) (2,509) (36)

Share of losses of associates - 1 2 (78) (89) (4) (3) (24)

Profit (loss) before income tax 788 (10,688) 1,227 107 (36) (6,268) 7,351 (185)

Income tax (1,173) 3,668 (582) (132) (102) 1,713 (2,358) 173

Consolidated net income (loss) (385) (7,020) 645 95 (160) (4,555) 4,993 (191)

Profit (loss) attributable to Controlling interest (577) (7,130) 544 92 (206) (5,487) 3,625 (251)

Profit attributable to Non-controlling interest 192 110 101 75 90 932 1,368 (32)

STATEMENT OF INCOME

4Q17 vs.(%)

February 12, 2018 1

Nemak reports 4Q17 results

- Quarterly revenues and EBITDA of US$1.1 billion and US$166 million, respectively

- New contracts awarded to Nemak for US$130 million in annual revenues

Monterrey, Mexico. February 12, 2018. - Nemak, S.A.B. de C.V. (“Nemak”) (BMV: NEMAK), a leading provider of innovative lightweighting solutions for the global automotive industry, announced today its operational and financial results for the fourth quarter of 2017 ("4Q17"). What follows is an overview of the quarter’s main highlights:

Key Figures

For 4Q17, volumes were 12.0 million equivalent units ("MEU"), 1.7% higher year-over-year ("y-o-y"), with Europe ("EU") showing healthy growth and North America ("NA") and Rest of World ("RoW") remaining stable. In turn, revenues were US$1,094 million, up 9.8% y-o-y on the back of higher average aluminum prices plus higher volumes. Full-year volumes were 49.9 MEU, down slightly vis-a-vis 2016, while revenues were US$ 4,481 million, up 5.3% due to higher aluminum prices.

4Q17 EBITDA was US$166 million, a 10.8% y-o-y decrease mainly due to the combined effect of negative metal price lag and higher launching expenses. EU was the company’s top-performing region, reporting improved profitability due to increased sales of higher value-added products. On a cumulative basis, EBITDA for the full year was US$715 million, 10.4% lower than last year due to the same factors behind quarterly y-o-y variations.

4Q17 capex was US$109 million as the company continued with investments to increase and adapt production capacity to meet new demand related to recently awarded contracts. Likewise, resources were invested in the continued launch of new programs to produce structural and electric vehicle components ("SC/EV") in NA and EU. For the full year of 2017, capex amounted to US$433 million.

February 12, 2018 2

Message from the CEO

We reached key milestones in the implementation of our strategy, securing new contracts that will position us to provide higher value-added solutions to our customers while continuing to advance with the ramp-up of our SC/EV operations. Our solid efforts in our SC/EV business throughout the year enabled us to generate annual revenues in this segment of approximately US$100 million.

While quarterly consolidated volumes finished slightly higher, our profitability decreased mainly due to external headwinds—in particular, rising aluminum prices—combined with increased launching expenses.

Building on our customer relationships, we were awarded new contracts across all business lines worth a total of US$130 million in annual revenues in the quarter. For the full 2017 year, new contract wins totaled US$830 million in annual revenues, similar to the amount secured the previous year.

We also took important steps to strengthen our financial position, issuing a US$500 million bond in the international debt markets in January, 2018 that will enable us to lower our financial costs and to extend the average life of our debt. The notes featured the all-time lowest coupon—4.75%—for a Ba1/BB+/BB+ rated issuance from a Latin American company.

Automotive Industry

In the quarter, SAAR for U.S. vehicle sales was down 1.6% y-o-y, with retail sales remaining stable while fleet sales decreased. In turn, North America vehicle production and Nemak customers’ vehicle production decreased 4.1% and 5.8%, respectively, as OEMs reduced inventories.

In Europe, vehicle sales SAAR in 4Q17 decreased 1.4% y-o-y due to lower sales in Western Europe. Nonetheless, vehicle production and Nemak customers’ production increased 7.9 and 10.3%, respectively, supported by increased production of vehicles for export to other regions.

February 12, 2018 3

Recent Developments

Nemak won two new SC/EV programs: one marking its entry into this segment in China; and one representing its first full assembly solution for a premium OEM in Europe. Total order book in the SC/EV business grew to approximately US$320 million in annual revenues.

Selected as a winner of the 2017 R&D 100 Awards for the co-development of a new high-temperature aluminum alloy together with FCA and Oak Ridge National Laboratory.

Named as a finalist for the 2018 Automotive News Pace Awards for the development of its lightweight Rotacast® aluminum casting process. The winners will be announced next April.

Financial Results Summary

What follows is an explanation of the results shown in the table above:

4Q17 total volume increased by 1.7% y-o-y driven by higher customer demand in Europe for Nemak components. In this region, 4Q17 volume increased 5.6% y-o-y reflecting the strength of the market. Meanwhile, North America volumes remained steady as new program launches compensated for lower customer production. Likewise in RoW, where industry recovery in South America compensated for lower customer demand in Asia for Nemak components.

For the full 2017 year, Nemak´s overall volume decreased slightly vis-à-vis 2016 as lower volumes in NA narrowly outweighed growth in EU and RoW.

Turning to revenues, higher aluminum prices combined with volumes drove Nemak´s 4Q17 consolidated revenues up 9.8% y-o-y. For the full year, rising aluminum prices more than compensated for lower volumes, causing revenues to increase 5.3% vis-à-vis 2016.

4Q17 operating income decreased 26.7% y-o-y, mainly as a result of negative metal price lag and increased expenses related to new program launches. Lower operating income translated into an operating margin of 6.0%, 300 basis points below 4Q16. For full-year 2017, operating income was 21.1% lower than 2016 due to the same reasons already explained, which in turn caused operating margin to decrease 280 basis points.

The above-mentioned decrease in 4Q17 operating income resulted in a 10.8% y-o-y reduction in EBITDA. 4Q17 EBITDA margin was 15.2%, down from the 18.7% reported in 4Q16. 4Q17 EBITDA per equivalent unit was US$13.80, down from US$15.80 in 4Q16. For full-year 2017, the already explained lower operating income caused EBITDA to finish 10.4% lower than in 2016. In turn,

February 12, 2018 4

EBITDA margin and EBITDA per equivalent unit were 16.0% and US$14.30, respectively, which compared to 18.7% and US$15.90 the previous year.

4Q17 net income decreased 40.0% compared to 4Q16 mainly due to lower operating income combined with foreign exchange losses. Full-year net income was 34.2% lower than in 2016 for the same reasons.

Capital expenditures totaled US$109 million during 4Q17. As explained, investments were made to expand capacity and to facilitate operational efficiency across the company’s regions. Capital expenditures for the year amounted to US$433 million.

As of December 31, 2017, Nemak reported Net Debt in the amount of US$1.3 billion, including Cash and Marketable Securities worth US$190 million. Financial ratios were: Debt, net of Cash, to EBITDA, 1.78 times; and Interest Coverage, 11.2 times. These ratios are similar to those reported at the end of 2016.

Regional Results

North America

In 4Q17, revenues increased 7.3% y-o-y due to higher aluminum prices. Turning to EBITDA, the adverse impact of metal price lag and increased launching expenses were the main causes of the 22.7% decrease y-o-y.

For full-year 2017, revenues increased 0.2% vis-a-vis 2016 while EBITDA decreased 17.2%, for the same reasons.

Europe

In 4Q17, revenues increased 19.4% y-o-y driven by new program launches and higher aluminum prices. Meanwhile, 4Q17 EBITDA increased 12.7% y-o-y, as higher volumes and an improved sales mix more than compensated for the effects of negative metal price lag.

For the full year, revenues increased 9.8% on the back of higher aluminum prices and higher volumes. However, EBITDA decreased 1.3% as higher revenues were not enough to offset negative metal price lag.

Rest of the World (RoW)

In 4Q17, revenues in RoW decreased by 7.8% y-o-y mainly due to a less favorable sales mix; nonetheless, both volume and EBITDA in the period were flat.

In 2017, revenues in RoW increased 22.2% compared to 2016 mainly due to higher volumes and a better product mix across Asia and South America. EBITDA in RoW increased US$12 million in 2017 compared to 2016 for the same reasons.

------------------

February 12, 2018 5

Methodology for presentation of results

The report presents unaudited financial information. Figures are in Mexican pesos or U.S. dollars, as indicated. For income statements, peso amounts were translated into dollars using the average exchange rate of the months during which the operations were recorded. For balance sheets, peso amounts were translated into dollars using the end-of-period exchange rate. Financial ratios were calculated in dollars. Due to rounding, small differences may occur when calculating percent changes from one period to another.

Conference call information

Nemak’s Fourth Quarter 2017 Conference Call will be held on Tuesday, February 13, 2018, 11:30 a.m. Eastern Time (10:30 a.m. Mexico City Time). To participate in the conference call, please dial: Domestic U.S.: (877) 407-0784; International: 1-201-689-8560; Mexico Toll Free: 01 800 522 0034. The conference call will be webcast live through streaming audio. If you are unable to participate, the conference call audio and script will be available on Nemak’s website. For more information, please visit investors.nemak.com

Forward-looking statements

This report may contain certain forward-looking statements concerning Nemak’s future performance that should be considered as good faith estimates made by the Company. These forward-looking statements reflect management’s expectations and are based upon currently available data and analysis. Actual results are subject to future events and uncertainties, which could materially impact Nemak’s actual performance and results.

About Nemak

Nemak is a leading provider of innovative lightweighting solutions for the global automotive industry, specializing in the development and manufacturing of aluminum components for powertrain and body structure applications. The company employs more than 22,000 people at 38 facilities worldwide. In 2017, it generated revenues of US$4.5 billion. For more information about Nemak, visit http://www.nemak.com

Three pages of tables to follow

http://www.nemak.com/investors

http://www.nemak.com/

February 12, 2018 6

February 12, 2018 7

February 12, 2018 8

Investor Relations:

Nancy Llovera [email protected] +52(81) 8114-1128

4th 2017 Quarter

Media Relations:

Julio Salinas [email protected] +52(81) 8114-1144

Patricio Jiménez [email protected] +52(81) 8114-1128

San Pedro Garza Garcia, Mexico, February 12, 2018 - Axtel, S.A.B. de C.V. (“Axtel” or “the Company”), a Mexican Information and Communications Technology company, announced today its unaudited fourth quarter results ended December 31, 2017(1). Results presented on this report reflect figures consolidated under Alfa S.A.B. de C.V. The complete unaudited fourth quarter results of Axtel have been filed with the Mexican Stock Exchange and are also available at the Company’s website, axtelcorp.mx .

Note: Financial information presented throughout this report includes unaudited consolidated results for Alestra S. de R.L. de C.V. and its subsidiaries (“Alestra”) up to February 14th, 2016, and for Axtel and its subsidiaries, including Alestra, from February 15th, 2016, and thereafter.

Highlights:

v  Fourth quarter results validated Axtel’s commitment to the strategy put in place after the merger; continue delivering IT and Telecom solutions to enterprise and government clients with the highest quality and service standards. In peso terms, quarterly revenues increased 13% year-over-year mainly due to an 18% increase in Enterprise and Government segment revenues; finishing off a strong year where revenues and EBITDA increased 5% and 38% respectively, compared to pro forma 2016, providing a solid base for 2018.

v  In the fourth quarter, Axtel successfully executed its refinancing strategy, issuing a US$500 million, 7-year bond and, in December, receiving a Ps. 6,000 million 5-year loan. Proceeds from these two transactions were used to prepay the existing syndicated bank loan. This refinancing extended the average life of the Company’s debt to over 5 years and provided further covenant flexibility, while maintaining the peso/dollar debt mix.

v  During the quarter, Axtel executed the third phase of its Tower Sale agreement with American Towers Corporation, receiving US$18 million in net proceeds. Axtel also continued supplying infrastructure and services to ALTAN under its vendor agreement, working towards completing the Red Compartida’s population coverage goal of 30% by March 2018.

YTDIn millions 3Q17 4Q16 Δ%Revenues (Ps.) 4,286 3,764 3,783 14% 13% 15,513 13,744 13%

In USD 226 211 191 7% 19% 822 736 12%EBITDA (Ps.) (5) 1,450 1,317 910 10% 59% 5,451 4,177 30%

In USD 77 74 46 4% 66% 290 225 29%Net (loss) Income (Ps.) -923 -632 -1,055 -46% 12% 62 -2,283 n.a.

In USD -49 -36 -52 -37% 5% 1 -117 n.a.

Capital Expenditures (Ps.) 784 748 885 5% -11% 3,032 3,581 -15%In USD 41 42 45 -1% -7% 160 210 -24%

Net Debt (In USD) 973 1,029 972 -5% 0%Net Debt / EBITDA (6) 3.4x 4.0x 4.6x

YTD'17 YTD'164Q17 4Q163Q17(%) 4Q17 vs.

2

Sources of Revenues

Quarterly revenues totaled $138 million, compared to $124 million in the same period in 2016, a 12% increase. In peso terms, Enterprise revenues in the fourth quarter of 2017 increased 7% compared to the same period in 2016, due to an increase in IT revenues.

Telecom revenues in the fourth quarter increased 7% compared to the fourth quarter in the previous year. In peso terms, revenues increased 2%, mainly due to a 12% increase in data and Internet revenues due to strong demand for dedicated internet from existing enterprise customers, mitigated by an 11% decline in voice revenues due to reductions in fix-to-mobile and international long distance revenues. Managed networks increased 2% year over year, as a 10% decline in managed services was compensated with 11% and 16% increases in Ethernet and Collaboration solutions respectively.

IT revenues increased 51% year-over-year. In peso terms, revenues increased 45%, mainly due to a significant increase in systems integration and positive performances from hosting, security and cloud services.

Enterprise

Total revenues increased 19% in the fourth quarter of 2017 compared to the same period in 2016. In peso terms, revenues increased 13%.

4Q16 4Q17

FTTx proportion within the revenue mix decreased from 14% in 4Q17 to 13% in 4Q16 and wireless declined from 7% to 4%; Enterprise decreased from 65% to 61% and Government increased from 15% to 22%, in peso terms.

YTDIn millions 3Q17 4Q16 Δ%

ENTERPRISE (Ps.) 2,612 2,482 2,451 5% 7% 9,945 9,079 10%In USD 138 139 124 -1% 12% 527 486 8%

GOVERNMENT (Ps.) 941 540 558 74% 69% 2,571 1,917 34%In USD 50 30 28 63% 77% 136 102 33%

MASS MARKET (Ps.) 733 742 775 -1% -5% 2,996 2,748 9%In USD 39 42 39 -7% -1% 159 147 8%

TOTAL (Ps.) 4,286 3,764 3,783 14% 13% 15,513 13,744 13%In USD 226 211 191 7% 19% 822 736 12%

YTD'17 YTD'16(%) 4Q17 vs.4Q17 3Q17 4Q16

80%

20%

Enterprise & Gov'tMass Market

83%

17%

Enterprise & Gov'tMass Market

YTDIn million USD 3Q17 4Q16 Δ%

TELECOM 119 124 111 -4% 7% 467 439 7%Voice 29 32 32 -7% -7% 124 135 -8%Data and Internet 49 50 42 -1% 18% 185 162 14%Managed Networks 40 42 38 -5% 7% 159 142 11%

IT 19 15 12 20% 51% 60 48 25%TOTAL ENTERPRISE 138 139 124 -1% 12% 527 486 8%

(%) 4Q17 vs. YTD'17 YTD'164Q17 3Q17 4Q16

3

Government revenues amounted to $50 million in the fourth quarter 2017, compared to $28 million in the same period in 2016, a 77% increase. In peso terms, Government revenues in the fourth quarter of 2017 increased 69% compared to the fourth quarter of 2016 mainly due to a rise in Telecom revenues. Recurrent revenues in the fourth quarter of 2017 increased 14% compared to the same period in 2016.

Telecom revenues increased 145% year-over-year. In peso terms, revenues increased 135%. Voice revenues increased 12% and data and internet increased 3%. Managed networks increased 295% due to increase in VPN solutions and to a strong increase in non-recurrent managed services to federal entities.

IT revenues increased 22% year-over-year. In peso terms, revenues rose 16% mainly due to a 29% increase in system integration services and 43% increase in managed applications.

Government

Enterprise and Government Segment Evolution

(Revenues in MPs.)

* Pro forma figures include Axtel and Alestra as of the beginning of each year.

(Pro forma)* (Pro forma)*


TELECOM 31 20 12 55% >100% 84 45 88%Voice 2 2 2 6% 16% 9 7 21%Data and Internet 5 6 5 -3% 7% 20 17 15%Managed Networks 23 12 6 89% >100% 56 20 >100%

IT 19 11 15 80% 22% 52 57 -10%TOTAL GOVERNMENT 50 30 28 63% 77% 136 102 33%

(%) 4Q17 vs. YTD'17 YTD'164Q17 3Q17 4Q16

4,634 5,067 5,519

12,980 11,588

12,517

2012 2013 2014 2015 2016 2017

Alestra Enterprise Government

4

Revenues for the mass market totaled $39 million in the fourth quarter of 2017, a 1% decline compared to the same period in 2016. In peso terms, mass market revenues decreased 5%.

FTTx revenues totaled $30 million in the fourth quarter of 2017, compared to $26 million for same period in 2016, representing a 16% increase. In peso terms, FTTx revenues increased 11% in line with a 13% increase in customers. Voice revenues increased 10% resulting from a 15% increase in monthly rent revenues. Internet revenues increased 13%, while video revenues maintained their 2016 levels.

Legacy technologies revenues amounted to $8 million in the fourth quarter of 2017, a 35% decrease compared the same period in 2016 or a 38% decrease compared the same period in 2016, explained by a 44% decline in customers.

Mass Market (2)


FTTx 30 32 26 -4% 16% 119 93 28%Legacy Technologies 8 10 13 -16% -35% 40 54 -27%

TOTAL MASS MARKET 39 42 39 -7% -1% 159 147 8%

(%) 4Q17 vs. YTD'17 YTD'164Q17 3Q17 4Q16

16 16 17 17 YTD QTR

16 16 17 17 YTD QTR

16 16 17 17 YTD QTR

5

Cost of Revenues (in Mdlls.)

Expenses (in Mdlls.)

EBITDA (in Mdlls.)

Cost of revenues, Operating and other expenses and EBITDA

Cost of revenues(3) (excludes depreciation and amortization cost). For the three month period ended December 31, 2017, the cost of revenues represented $66 million, a 66% increase compared to the same period in 2016. In peso terms, the cost of revenues increased 59%, mainly due to increases in Telecom Managed Networks costs from the Government segment and IT costs. In addition, as part of the homologation accounting process between Axtel and Alestra, costs that were previously classified as operating expenses related to billing, collection and maintenance directly associated with customers are being recorded as costs as of 2017. This adjustment represents a year-over-year increase of $6 million in the quarter.

Operating and other expenses(4) (excludes depreciation and amortization expense). In the fourth quarter of year 2017, total expenses totaled $83 million, 20% lower than the $105 million recorded in the same period in year 2016. In peso terms, total expenses declined 24%, mainly due to the positive effect of $18 million in other income related to the third phase of the tower sale recorded during the quarter and a 3% decline in operating expenses. Total expenses excluding the benefit from the tower sale transaction and also non-recurring merger expenses declined 6% compared to fourth quarter of 2016, reflecting the benefits from the merger synergies that compensated increases due to higher revenues and inflation adjustments.

EBITDA(5). For the fourth quarter of 2017, EBITDA totaled $77 million, a 66% increase compared to the same period in year 2016. This figure includes $18 million of other income related to the closing of the third phase of the tower sale. For the three month period ended December 31, 2017 and 2016, non-recurring merger and integration process expenses totaled $12 million and $14 million, respectively. In peso terms, EBITDA increased 59% year-over-year, and without the benefit from the tower sale nor merger-related expenses, EBITDA increased 13%.

40

150

66

209

105

362

83

323

46

225

77

290

6

Comprehensive Financing Result

Total Debt. At the end of the fourth quarter 2017, total debt decreased $5 million in comparison with fourth quarter 2016. The decrease is explained by (i) a $500 million increase related to the 2024 Senior Notes; (ii) a $507 million decrease in Bank Facilities due to the prepayment of the syndicated bank facility; (iii) a $14 million decrease from other loans and financial leases; (iv) a $1 million increase in accrued interests; and (v) a $16 million non-cash increase caused by the 5% appreciation of the Mexican peso.

Cash. As of the end of the fourth quarter of 2017, the cash balance totaled $72 million,

compared to $77 million a year ago, and $48 million at the beginning of the quarter. The cash balance at the end of the quarter includes $8 million restricted cash.

Total Debt and Net Debt (7)

The comprehensive financing cost reached $88 million in the fourth quarter of 2017, compared to $62 million in the same period of 2016. This increase is explained mostly by a higher FX loss during the fourth quarter of 2017 due to an 8% depreciation of the Mexican peso, compared to a 6% depreciation of the Mexican peso in the fourth quarter of 2016 and an increase in interest expenses due to rises in interest rates.

In the fourth quarter of 2017, capital investments totaled $41 million, compared to $45 million in the year-earlier quarter, a 7% decline. Capex for full year 2017 totaled $160 million.

Capital Expenditures

YTDIn million USD 3Q17 4Q16 ∆%

Net interest expense (27) (21) (16) -26% -68% (84) (72) -16%FX gain (loss), net (64) (13) (44) >100% -46% 32 (112) n.a.Ch. in FV of fin. Instruments 3 0 (2) >100% n.a. 1 (10) n.a.

Total (88) (35) (62) >100% -43% (51) (195) 74%

4Q16 (%) 4Q17 vs. YTD'17 YTD'164Q17 3Q17

Million dollars 4Q17 3Q17 4Q162024 Senior Notes 500 - - Bank Facilities 325 844 822 Other loans 189 204 193 Other financing obligations 23 22 29 Accrued interests 7 8 6 Total Debt 1,045 1,077 1,050 (-) Cash and cash equivalents (72) (48) (77) Net Debt 973 1,029 972

Appendix Other important information

1)  Financial information presented is based on International Financial Reporting Standards (IFRS) in nominal pesos for the following periods:

–  Consolidated income statement information for the three month periods ending on December 31, 2017 and 2016, and September 30, 2017; and year-to-date periods ending on December 31, 2017 and 2016, and

–  Balance sheet information as of December 31, 2017 and 2016; and September 30, 2017.

2)  Mass market operating data:

3)  Costs of revenues include expenses related to the termination of our customers’ cellular and long distance calls in other carriers’ networks, as well as expenses related to billing, payment processing, operator services and our leasing of private circuit links. Costs that were previously classified as operating expenses related to billing, collection and maintenance directly associated with customers are being recorded as costs as of 2017.

4)  Operating and other expenses are those incurred in connection with general and administrative matters, such as personnel, land and tower leases, sales and marketing, maintenance of our network and net other not recurrent expenses including merger and integration expenses.

5)  EBITDA is defined as operating income (loss) plus depreciation and amortization, plus impairment of assets.

6)  Net Debt to EBITDA ratio: Net debt translated into U.S. Dollars using the end-of-period exchange rate divided by the respective LTM pro forma EBITDA translated into U.S. Dollars using the average exchange rate for each month.

7)  Total debt includes accrued interests for each period. Net debt is calculated subtracting cash and equivalents, including non-current restricted cash, from total debt.

* Revenue Generating Units, represent individual service subscriptions (line, broadband, video) which generate recurring revenues for the Company.

7

In thousands Q4 2017 Q3 2017 Q4 2016FTTX

Customers 263 253 233 RGUs 719 693 639

Lines in service 332 317 281 Broadband subscribers 265 255 234 Video subscribers 122 121 124

LEGACY TECHNOLOGIESCustomers 116 135 207 RGUs 227 263 393

Lines in service 129 150 226 Broadband subscribers 98 113 167

8)  As part of the merger agreement approved on the January 15, 2016 Extraordinary General Shareholder’s Meeting, Alfa had the right to increase its ownership in Axtel by up to 2.5%, or the obligation to contribute cash to Axtel, depending on the average exchange rate of an 18-month period ending on July 14, 2017. Given that the average exchange rate of the period was above 18.50 pesos per dollar, Axtel transferred 1,019’287,950 Class “I” Series “B” shares to Alfa, equivalent to an additional participation of Alfa in Axtel of 2.5%. Resulting from this agreed-upon merger consideration, the number of outstanding, subscribed paid-up Class “I” Series “B” shares is 20,249,227,481 as of the date of this report. Please note seven Series “B” shares are equivalent to one AXTELCPO.

About AXTEL Axtel is a Mexican Information and Communication Technology Company that serves the enterprise, government and residential markets with a robust portfolio of solutions through its brand Alestra (enterprise and government services) and its brand Axtel (residential and small businesses services).

With a network infrastructure of over 42 thousand kilometers of fiber and more than 7 thousand square meters of data center, Axtel enables organizations to be more productive and brings people together to improve their quality of life.

As of February 15, 2016, Axtel is a subsidiary of Alfa, which owns 53.5% of its equity.

Axtel shares, represented by Ordinary Participation Certificates, or CPOs, trade on the Mexican Stock Market under the symbol “AXTELCPO” since 2005.

Axtel’s Investor Relations Center: www.axtelcorp.mx Enterprise and Government services website: www.alestra.mx Mass Market services website: www.axtel.mx

8

9

Axtel, S.A.B. de C.V. and Subsidiaries Unaudited Consolidated Balance Sheet (in Thousand Mexican pesos)

(%) Dec-17 vs.Dec-17 Sep-17 Dec-16 Dec-16

ASSETSCURRENT ASSETSCash and equivalents 1,257,803 721,797 1,447,118 (13)Accounts receivable 2,679,833 3,204,734 3,129,046 (14)Related parties 31,702 25,696 20,949 51Refundable taxes and other accounts receivable 832,567 781,338 916,831 (9)Advances to suppliers 485,732 547,883 517,456 (6)Inventories 188,885 216,397 109,388 73Financial Instruments 61,913 - - n.a.Financial Instruments (Zero Strike Call) 164,278 187,746 152,978 7Total current assets 5,702,713 5,685,590 6,293,765 (9)

NON CURRENT ASSETSRestricted cash 161,955 159,908 153,040 6Property, plant and equipment, net 19,275,810 19,258,561 19,619,451 (2)Long-term accounts receivable - - 8,642 n.a.Intangible assets, net 1,508,512 1,531,669 1,838,727 (18)Deferred income taxes 3,747,711 3,395,906 4,056,773 (8)Investment in shares of associated co. & other 139,427 22,260 1,708 >100Other assets 217,646 222,715 203,597 7Total non current assets 25,051,061 24,591,019 25,881,938 (3)

TOTAL ASSETS 30,753,774 30,276,609 32,175,703 (4)

LIABILITIES & STOCKHOLDERS' EQUITYCURRENT LIABILITIESAccount payable & Accrued expenses 3,881,152 3,423,677 3,183,091 22Accrued Interest 145,681 139,241 132,815 10Short-term debt 700,000 300,000 400,000 75Current portion of long-term debt 533,253 434,440 495,773 8Taxes payable 18,616 39,504 17,357 7Deferred Revenue 312,121 284,416 1,022,982 (69)Provisions 117,908 23,906 129,647 (9)Other accounts payable 2,195,956 1,846,816 2,444,612 (10)Total current liabilities 7,904,687 6,492,001 7,826,276 1

LONG-TERM LIABILITIESLong-term debt 19,043,736 18,617,083 20,485,861 (7)Employee Benefits 588,696 540,628 467,036 26Other LT liabilities 724,250 986,429 996,292 (27)Total long-term debt 20,356,682 20,144,140 21,949,190 (7)

TOTAL LIABILITIES 28,261,369 26,636,141 29,775,466 (5)

STOCKHOLDERS EQUITYCapital stock 464,368 464,371 10,233,841 (95)Additional paid-in capital 159,551 522,907 644,710 (75)Reserve for repurchase of shares - - - n.a.Cumulative earnings (losses) 1,868,480 2,653,190 (8,478,319) n.a.

TOTAL STOCKHOLDERS' EQUITY 2,492,405 3,640,468 2,400,237 4

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 30,753,774 30,276,609 32,175,703 (4)

10

Axtel, S.A.B. de C.V. and Subsidiaries Unaudited Consolidated Income Statement (in Thousand Mexican pesos)

Note: “YTD’16” figures include consolidated results for Alestra S. de R.L. de C.V. and its subsidiaries (“Alestra”) up to February 14th, 2016, and for Axtel and its subsidiaries, including Alestra, from February 15th, 2016, and thereafter.

4Q17 3Q17 4Q16 3Q17 4Q16 YTD'17 YTD'16 Δ%

Total Revenues 4,286,395 3,764,081 3,783,302 14 13 15,513,090 13,743,672 13

Operating cost and expensesCost of sales and services (1,258,151) (904,076) (790,408) 39 59 (3,947,167) (2,787,606) 42Selling, administrative and other expenses (1,578,449) (1,542,619) (2,082,775) 2 (24) (6,114,708) (6,778,576) (10)Asset impairment (1,535) (7,725) (104,348) (80) (99) (11,724) (52,991) (78)Depreciation and amortization Cost (856,062) (858,880) (836,532) (0) 2 (3,456,436) (3,005,241) 15Depreciation and amortization Expenses (153,565) (145,803) (233,707) 5 (34) (577,402) (634,065) (9)

(3,847,762) (3,459,104) (4,047,769) 11 (5) (14,107,437) (13,258,479) 6

Operating income (loss) 438,633 304,977 (264,468) 44 n.a. 1,405,653 485,193 >100

Comprehensive financing result:Interest expense (532,033) (399,561) (326,526) 33 63 (1,647,028) (1,377,850) 20Interest income 18,340 17,350 6,940 6 >100 56,699 23,092 >100Foreign exchange gain (loss), net (1,216,743) (238,407) (907,628) >100 34 648,280 (2,206,658) n.a.Change in fair value of fin. instruments 55,651 6,232 (40,852) >100 n.a. 27,053 (192,122) n.a.

Comprehensive financing result, net (1,674,786) (614,386) (1,268,067) >100 32 (914,996) (3,753,539) (76)

Equity in results of associated company 0 (0) (265) n.a. n.a. (0) (5,189) (100)

Income (loss) before income taxes, (1,236,153) (309,409) (1,532,800) >100 (19) 490,658 (3,273,535) n.a.

Income taxes: Current (25,503) 95,472 762 n.a. n.a. (115,834) (91,122) 27 Deferred 338,641 (418,400) 477,230 n.a. (29) (312,650) 1,081,603 n.a.

Total income taxes 313,138 (322,928) 477,992 n.a. (34) (428,484) 990,480 n.a.

Net Income (Loss) (923,015) (632,337) (1,054,807) 46 (12) 62,173 (2,283,054) n.a.

(%) 4Q17 vs.


NEWPEK | NATURAL GAS AND HYDROCARBONS 1% AND 0% OF ALFA´S REVENUES AND EBITDA IN 4Q17 Newpek is an oil & gas exploration and production company with operations in the United States and Mexico. Thecompanyownsmineralrights inseveralstateswithintheUSwhereitextractsoil,naturalgasandliquids. InMexico, itsoperationsareconcentratedintwomatureoilfieldsunderaserviceagreementwithPetróleosMexicanos(PEMEX)andtherightsfortwolicenseagreementswithCNH.

INDUSTRY COMMENTS

Hydrocarbonpricesshowedmixedbehavior,ascrudeoilpricesduringthequarterrosetolevelsnotseensince2015,whilenaturalgaspricesaveragedslightlylowercomparedwithpriorquarters.WestTexasIntermediateoilpriceaveragedUS$55perbarrel,up15%comparedto3Q17,whileHenryHubnaturalgaspriceaveragedUS$2.9perMMBTU,1%lowerthanthepreviousquarter.ThefourthquartersawOPECrenewitscommitmenttocutproductionuntiltheendof2018whilealsoaddingLibyaandNigeriatotherestraints.Withpricesontherise,theUSrigcountmaintainedthesamelevelswesawduring3Q17,whichsupportedprices further.HenryHubpricesalsostartedthequarterrisingasweekly inventorydatacontinuedtoreflectalowerinjectionrateandtotal inventoriesdroppingbelowtheprevious5-yearaveragelevel,butawinterwithmilderthanexpectedtemperaturesweakenedpricesduringDecember.

OPERATIONS IN THE USA

During4Q17,ninenewwellswereconnectedtosalesattheEagleFordShaleplay(“EFS”)inSouthTexas.ThisbroughtwellsinproductionatEFSto648bythequarter’send,comparedtothe628wellsinproductionattheendof4Q16.SalesvolumeintheUSaveraged6.2MBOEDduring4Q17,up4%from4Q16,reflectingthestrongproductionfromthewellsconnectedduring2017.Liquidsandoilrepresented67%ofthetotalvolumeforthequarter,downfrom68%ayearago.Initialresultsof the twenty new wells have been encouraging. The new completion technique, testing longer laterals with higherintensitycompletionsisprovingtoyieldhighercapitalefficiencythantheoriginalwellsdrilledinsimilarlocations.All2017wellsarebeingcompletedusingthisnewtechnology.StrategicdrillingandcompletionactivitieswillcontinueatEFSduring2018.Asaresult,fifteennewwellsareexpectedtobeputintoproductionduring2018.

Additionally,fivenewwellsweredrilledandcompletedintheWilcoxformationinSouthTexas,whereNewpekhasa20%working interest. These wells were put into production during 4Q17. The prospects in the other areas within the USremainedonholdduringthequarter,butdrill-readylocationshavebeenidentifiedandareexpectedtobedrilledsoon.

OPERATIONS IN MEXICO

InMexico,productionaveraged3.4MBOEDduring4Q17,down3%from4Q16.TheSanAndrésfieldrepresented68%ofthetotalproductionforthequarter,essentiallyflatyear-on-year.Therewere134wellsinproductioninMexicoatquarter’send,a5%increasefromthe128wellsinproductionattheendof4Q16.

FINANCIAL RESULTS; CAPITAL EXPENDITURES AND ACQUISITIONS; NET DEBT

Oilpricesincreasedyear-on-year,withWTIOilpriceup4%,meanwhilegaspricesdecreased,withHenryHubnaturalgaspricedown4%,resultinginhigherrevenuesinthequarter,whichtotaledUS$31millionin4Q17,up14%year-on-year.4Q17 EBITDA was US $3 million, down 71% year-on-year, as 4Q16 benefitted by extraordinary income. CapitalexpendituresamountedtoUS$13million,whilenetdebtwasUS$34millionattheendofthequarter.


NEWPEKTABLE1|REVENUES

(%)4Q17VS. 4Q17 3Q17 4Q16 3Q17 4Q16 YTD.17 YTD.16 Ch.%TOTALREVENUES Ps.Millions 591 368 544 60 9 2,036 1,991 2US$Millions 31 21 27 51 14 107 107 1

DOMESTICREVENUES Ps.Millions 244 141 246 72 (1) 957 920 4US$Millions 13 8 12 62 4 50 49 2

FOREIGNREVENUES Ps.Millions 347 227 298 53 16 1,078 1,071 1US$Millions 18 13 15 44 22 57 57 (1)Foreign/Total(%) 59 62 55 53 54 VOLUME (US Assets) ThousandsofBarrelsofOilEquivalentPerDay(MBOEPD) 6.2 4.3 5.9 4.9 7.2 Liquids&othersas%oftotalsalesvolume 67 67 6.8 6.7 64

TABLE3|SELECTEDBALANCESHEETINFORMATION&FINANCIALRATIOS(US$MILLIONS) 4Q17 3Q17 4Q16 YTD.17 YTD.16Assets 647 346 343 647 343Liabilities 329 313 292 329 292Stockholders’Equity 318 33 51 318 51NetDebt 34 30 25 34 25NetDebt/EBITDA* 12 2.7 2.7 12 2.7InterestCoverage* 0.7 1.8 1.5 0.7 1.5*Times:LTM=Last12months


(%)4Q17VS. 4Q17 3Q17 4Q16 3Q17 4Q16 YTD.17 YTD.16 Ch.%OPERATINGINCOME Ps.Millions (234) (174) (1,275) (35) 82 (699) (1,945) 64US$Millions (12) (10) (62) (26) 80 (37) (99) 63EBITDA Ps.Millions 64 15 240 328 (73) 50 199 (75)US$Millions 3 1 12 303 (71) 3 9 (70)

Documents

FOURTH QUARTER 2017 FINANCIAL REPORT ALFA ...ALFA´S FOURTH QUARTER 2017 2 SUMMARY OF GROUPS´ PERFORMANCE DURING 4Q17 Sigma’s revenues amounted to US $1,593 million, up 11% from